Question 1

The Global Economic Prospects report is a flagship publication of the International Monetary Fund.

Accepted Answer

The Global Economic Prospects is published biannually by the World Bank Group, whereas the World Economic Outlook is released by the IMF.

Question 2

Higher US tariffs led to a downgrade in India's FY27 growth forecast in the January 2026 report.

Accepted Answer

India's FY27 growth forecast was actually held steady at 6.5 percent compared to the previous June projection, as robust domestic demand fully offset the expected tariff impacts.

Question 3

Consider the following statements regarding the World Bank's Global Economic Prospects January 2026 report:
1. It projected a widening global income gap, noting that a quarter of developing countries have per capita incomes below 2019 levels.
2. India's FY26 growth estimate was upgraded to 7.2 percent primarily due to a massive surge in manufacturing exports to the United States.
3. The report features a specific analytical chapter emphasizing that fiscal rules can improve the fiscal balance by an average of 1.4 percent of GDP over the medium term.
How many of the above statements are correct?

Accepted Answer

(b) Only two — Statement 1 is correct: The report warned of a widening income gap, with a quarter of developing nations still below pre-pandemic per-capita income levels. Statement 2 is incorrect: The upgrade to 7.2 percent was driven by strong domestic demand, robust private consumption, and tax reforms, not a massive surge in manufacturing exports to the US (in fact, 50 percent US tariffs acted as a headwind). Statement 3 is correct: The January 2026 report included a special chapter on the positive impacts of fiscal rules on fiscal balances.

Question 4

Match the global economic reports with their respective publishing institutions:
List I (Report)
1. Global Economic Prospects
2. World Economic Outlook
3. Key Indicators for Asia and the Pacific
4. World Economic Situation and Prospects

List II (Institution)
A. International Monetary Fund (IMF)
B. Asian Development Bank (ADB)
C. United Nations (UN)
D. World Bank Group

Accepted Answer

(a) 1-D, 2-A, 3-B, 4-C — The Global Economic Prospects is published by the World Bank. The World Economic Outlook is the flagship report of the IMF. The Asian Development Bank publishes Key Indicators for Asia and the Pacific. The United Nations releases the World Economic Situation and Prospects.

Question 5

Assertion (A): The World Bank projected India's economic growth to decelerate from 7.2 percent in FY26 to 6.5 percent in FY27.
Reason (R): The United States imposed 50 percent import tariffs on certain Indian goods, creating headwinds for India's external sector.
Select the correct answer from the codes given below:

Accepted Answer

(a) Both A and R are true and R is the correct explanation of A. — Both statements are factually correct according to the World Bank's GEP January 2026 report. The anticipated moderation in growth to 6.5 percent in FY27 is explicitly attributed to global uncertainties and the assumption that the 50 percent import tariffs by the US remain in place, making R the correct explanation for the deceleration noted in A.

World Bank Global Economic Prospects January 2026 Published

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