India keeps rank as world's fastest-growing economy with 5.8% rate

India will remain the fastest-growing major economy recording a growth of 5.8 per cent this year, while the rest of the world will grow by a paltry 1.9 per cent, the UN said on Thursday.

The UN's World Economic Situation and Prospects (WESP) report sliced off 0.2 per cent from the 6 per cent gross domestic product growth projection made last May without affecting India's rank as the country faces headwinds from the global economy.

Overall, the report said: "Growth in India is expected to remain strong at 5.8 per cent, albeit slightly lower than the estimated 6.4 per cent in 2022, as higher interest rates and a global slowdown weigh on investment and exports."

Next year, the UN expects India's economy to grow by 6.7 per cent.

The WESP gave a positive picture of India's jobs scene, noting that its "unemployment rate dropped to a four-year low of 6.4 per cent in India, as the economy added jobs both in urban and rural areas in 2022".

For the world, the WESP forecast is 1.9 per cent this year and rising to 2.7 per cent next year.

In New Delhi, India's President Droupadi Murmu credited India's economic performance to "its leadership".

"India has been among the fastest-growing major economies because of the timely and proactive interventions of the government. The 'Aatmanirbhar Bharat' initiative, in particular, has evoked great response among the people at large," Murmu said in her Republic Day speech.

China, which came in second, is projected to grow by 4.8 per cent this year and 4.5 next year, after a 3 per cent growth in 2022.

The US economy is projected to grow by 0.4 per cent this year and 1.7 per cent the next.

For South Asia as a whole, the report said the region's "economic outlook has significantly deteriorated due to high food and energy prices, monetary tightening and fiscal vulnerabilities" and it forecast a 4.8 per cent growth year and 5.9 per cent next year.

This was buoyed by India as the report said: "The prospects are more challenging for other economies in the region. Bangladesh, Pakistan, and Sri Lanka sought financial assistance from theA International Monetary Fund (IMF) in 2022."