IMF for emerging markets hiking infrastructure spend for global recovery

NEW DELHI: The International Monetary Fund has said inadequate infrastructure in emerging economies, including India, is a key constraint on their short-term growth and asked them to boost spending to strengthen sluggish global recovery.

“Although many factors are likely to be playing a role, one frequently expressed concern is inadequate infrastructure,” said the World Economic Outlook report, Legacies, Clouds, Uncertainties. In emerging economies including Brazil, India, Russia and South Africa, infrastructure bottlenecks are not just a medium-term worry but have been flagged as a hurdle even to near-term growth, IMF said in its latest report.

Increased investment in infrastructure such as roads and bridges is "one of the few remaining policy levers available to support growth" in advanced economies, given that monetary policy is already loose, IMF staff said Wednesday in a report to be included in its next World Economic Outlook. "In all economies it would help boost medium-term output," they said.

Policy makers are looking for ways to speed up growth amid a global recovery that has repeatedly underperformed IMF forecasts. The Washington-based lender will release its latest World Economic Outlook on October 7, ahead of its annual meeting in Washington October 10-12.