Business · Economy · 10 hrs ago
IMF warns Super El Niño could threaten India’s growth
The IMF has flagged Super El Niño as a risk to India’s economy.
The weather phenomenon could reduce crop yields and push food prices higher, weakening household purchasing power.
Those effects have not yet materialised, the IMF said.
Earlier this month, it raised its forecast for India’s growth to 7% in both FY27 and FY28, citing strong domestic demand and services activity.
India’s current growth momentum remains strong, according to the IMF.
The risks matter because lower farm output and costlier food could put pressure on households.
The IMF will reassess its forecasts in January as it reviews how the weather risks develop.
The IMF warned that a Super El Niño could weaken India’s growth by reducing crop yields and raising food prices.
The risks have not yet materialised, IMF Communications Director Julie Kozack said.
The IMF said lower agricultural output and higher food inflation could reduce Indian households’ purchasing power.
The Fund plans to reassess its India growth projections in its January World Economic Outlook update, depending on how the weather risks develop.
Earlier this month, the IMF forecast India’s growth at 7% in both FY27 and FY28, citing strong domestic demand and services activity.
- Who
- The International Monetary Fund, through Communications Director Julie Kozack.
- What
- The IMF warned that Super El Niño could threaten India’s growth. The risks have not yet materialised.
- When
- The IMF made the warning on Thursday. It plans to review its projections in January.
- Where
- India.
- Why
- Lower crop yields and higher food prices could weaken household purchasing power.
This story does not have two clearly opposing sides.
The IMF forecast India’s growth at 7% in both FY27 and FY28, citing domestic demand and strong services activity.
Julie Kozack said the Super El Niño risks had not yet materialised.
The IMF plans to reassess its growth projections for India in its next World Economic Outlook update.
- IMF growth forecast
- 7% for FY27 and 7% for FY28
- Previous FY27 forecast
- 6.4%
- Previous FY28 forecast
- 6.7%
- Potential effects
- Lower crop yields and higher food prices
- Next review
- January World Economic Outlook update
What people are saying
So these are risks that we see that India faces, but right now those risks have not materialised
But for now what we see is quite strong growth momentum in India, and it continues to be an engine of growth