The multilateral lending institution said the balance sheet vulnerabilities in India pose a downside risk to its medium-term growth prospects, requiring policy action. Compared to the January WEO report, the forecasts for the economy growth of the CIS member countries remained unchanged. However, the global monetary cooperation also raised several concerns over India's economy.
It's noticeably less than the strong three per cent growth Canada experienced in 2017.
The International Monetary Fund has said the tax cuts introduced by the Trump administration will give a temporary boost to the U.S. economy, but the tax reform effects will wear off in two years time.
"Resurgent investment spending in advanced economies and an end to the investment decline in some commodity-exporting emerging market and developing economies were important drivers of the uptick in global GDP growth and manufacturing activity [in 2017]", said the report.
"The growth rate in China is projected to soften down during this period", it said, adding that over the medium term, its economy is projected to continue re-balancing away from investment toward private consumption and from industry to services, but nonfinancial debt is expected to continue rising as a share of GDP, and the accumulation of vulnerabilities clouds the medium-term outlook.
Maurice Obstfeld, research chief at the world's lender of last resort, said that long-term prospects for the global economy are "sobering" as escalating tensions over trade "present a growing risk" to prosperity.More news: Bismarck police arrest man for threatening 4 officers
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"That major economies are flirting with trade war at a time of widespread economic expansion may seem paradoxical-especially when the expansion is so reliant on investment and trade".
The IMF on Tuesday projected a global growth of 3.9 percent in the next two years due to strong momentum, favourable market sentiment among other factors but warned that any trade disputes threaten to undermine confidence and derail global growth prematurely.
However, the International Monetary Fund warns future growth prospects look challenging for advanced economies faced with ageing populations and low productivity growth, making it hard for household income growth to return to their pre-GFC pace.
The IMF has also predicted Chinese growth of 6.6% this year, an increase of 0.1% on the last forecast, while Japan is set for growth of 1.2%, a 0.5% uplift.
The eurozone is expected to grow by 2.4% in 2018 and 2% in 2019, up by 0.2 points and unchanged respectively.
According to a study in the funds' latest World Economic Outlook report, Ireland, alongside Korea and Taiwan Province of China, are estimated to be the main beneficiaries of the new tech cycle in value added terms.