The International Monetary Fund (IMF) has stated that it will "encourage" India to lift restrictions on the export of a specific type of rice, saying that doing so will have an impact on world inflation.
On July 20, the Indian government imposed restrictions on the export of non-basmati white rice to boost domestic supply and keep retail prices under check during the upcoming festive season. This type of rice includes nearly 25 per cent of total rice exported from the country.
The food ministry said that there will be no change in the export policy of par-boiled non-basmati rice and basmati rice, which contributes to the majority of exports. In the current environment, these types of restrictions are likely to exacerbate volatility on food prices in the rest of the world. They can also lead to retaliatory measures, Pierre-Olivier Gourinchas, Chief Economist, International Monetary Fund (IMF), told a press conference in New Delhi, according to the news agency PTI.
"So, they are certainly something that we would encourage the removal of these types of export restrictions, because they can be harmful globally," he said while responding to a question.
"India remains an economy that is growing quite strongly. I mean, it's coming down from really a very strong year in 2022, at 7.2 per cent. That was also revised upwards, by the way -- but still slow down, but still fairly strong growth and fairly strong momentum," Gourinchas said.
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The IMF also predicted that India's economy will grow at 6.1 per cent in 2023, a 0.2 percentage point upward revision compared with the April projection, reflecting momentum from stronger-than-expected growth in the fourth quarter of 2022 as a result of stronger domestic investment.
IMF said in latest update of the World Economic Outlook that growth in emerging and developing Asia is on track to rise to 5.3 per cent in 2023, then to 5.0 percent in 2024, showcasing a 0.1 percentage point downward revision for 2024.
"Growth in India is projected at 6.1 percent in 2023, a 0.2 percentage point upward revision compared with the April projection, reflecting momentum from stronger-than-expected growth in the fourth quarter of 2022 as a result of stronger domestic investment," IMF's World Economic Outlook Update said, according to the news agency ANI.