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Kristalina Georgieva, the Managing Director (MD) of the International Monetary Fund (IMF) has said that India has been very good at managing its finances but the surge in global energy prices is going to have a negative impact on its economy. She observed that the war has posed a challenge to economies around the world, including India.

Georgieva said clearly the most significant channel of impact on the Indian economy is energy prices. She noted that India is an importer and the increase in energy prices is going to have a negative impact. India has been very good in managing its finances. She stressed that there are some fiscal spaces to be able to respond to the challenge.

The IMF managing director said ‘our advice to our members is first and foremost make sure that you protect the most vulnerable populations from the shot up of prices, not only energy but also foot food prices for countries where this is going to be a significant factor.’ She also said ‘target your fiscal space to those that are in a grievous need to be supported. We would also be looking into monetary policy responses, as to how could they be calibrated appropriately to what is happening.’