India's economic slowdown was an aberration; World Bank lauds PM Modi's efforts
Washington, October 5: The World Bank said that India's economic slowdown was an aberration, as it assured that GDP growth will stabilise during the year. Saying that GST will have 'hugely positive impact on the economy', World Bank President Jim Yong Kim added that the deceleration was due to temporary disruptions in preparation for the GST.
"Theres been a deceleration in the first quarter, but we think thats mostly due to temporary disruptions in preparation for the GST, which by the way is going to have a hugely positive impact on the economy," Kim told a group of reporters during a conference call ahead of the annual meeting of the International Monetary Fund and the World Bank here.
Kim was responding to questions on slowdown in Indias growth in the first quarter, which the Opposition and several economists have attributed to demonetisation and the GST.
"We think that the recent slowdown is an aberration which will correct in the coming months, and the GDP growth will stabilise during the year. Weve been watching carefully, as Prime Minister (Narendra) Modi has really worked on improving the business environment, and so, we think all of those efforts will pay off as well," Kim said.
"Let me just say, as I said from the beginning. Im not sure that I could say that any country in the world is investing enough in their human beings. I think theres no country in the world that cant improve its healthcare system. Theres no country in the world that cant improve its educational system," Kim said.
The World Bank president said, "I know that Prime Minister Modi himself personally is very committed to improving opportunities for all of India. But, India has a lot of challenges. We look at some of the educational outcomes, weve looked at some of the health outcomes, and India has room to improve, like most other countries."
"Our job is to take the political will and commitment that Prime Minister Modi has clearly demonstrated and has communicated to everyone, and then bring to India the most effective intervention that will, as quickly as possible, improve the stock of human capital," Kim said.
Indias GDP grew 5.7 percent on a year-on-year basis during the April-June period. During the previous quarter (January-March) the GDP had grown by 6.1 percent. The GDP growth rate for the same quarter last year was 7.9 percent. Notably, Finance Minister Arun Jaitley would be leading the Indian delegation to the annual meeting next week.