Warning of high debt levels,the International Monetary Fund (IMF) on Monday cut its global economic growth projection to 3.5 per cent for 2012 from 3.6 per cent forecast in April after rapid slowdown in China and India.
Indias growth forecast has been pared sharply by 0.7 percentage points each to 6.1 per cent for 2012 and 6.5 per cent for 2013 from 7.1 per cent last year and 10.8 per cent in 2010,IMF said in its update of the World Economic Outlook.
Chinas growth projection has been lowered by 0.2 percentage points to 8 per cent for 2012 and by 0.3 percentage points to 8.5 per cent for 2013. China,which expanded 9 per cent last year and 10.4 per cent in 2010,continues to be the global growth driver.
Despite the sharp slowdown,India will still be the second fastest growing nation among major EMEs with Russia expected to expand 4 per cent in 2012,while Brazil will grow by 2.5 per cent,South Africa 2.6 per cent and Mexico 3.9 per cent.
While warning of upside risks to an early recovery,IMF said global growth rate in 2013 could quicken to 3.9 per cent if developed nations cut debts and emerging economies ease monetary stance.