The Indian economy is expected to grow at a 6.3% annual rate in the current fiscal year and the following one, according to the International Monetary Fund (IMF) late Monday, underpinned by macroeconomic and financial stability.

According to the IMF's Article IV consultation report, which examines a country's current and medium-term economic prospects, the country's digital public infrastructure and a strong government infrastructure programme will continue to maintain growth.

"India has potential for even higher growth, with greater contributions from labor and human capital, if comprehensive reforms are implemented," according to the International Monetary Fund (IMF).  

The IMF's growth forecast for the current fiscal year, which ends March 31, 2024, is lower than the Reserve Bank of India's (RBI) expectation of 7%. 

"Headline inflation is expected to gradually decline to the target although it remains volatile due to food price shocks," according to the International Monetary Fund (IMF).  

Food price volatility increased retail inflation to 5.55 percent in November, up from 4.87 percent the prior month. While this was within the RBI's tolerance limit of 2% to 6%, it was nevertheless higher than the aim of 4%.