The International Monetary Fund on Tuesday said India’s Gross Domestic Product will grow by 7.6% in 2016-’17, Mint reported. The IMF said the upward revision from its previous figure of 7.4% in July was because of growth momentum in the country, as well as the economy's resilience.

The IMF’s World Economic Outlook report cited reasons like “effective policy actions” for its growth upgrade. It said that the Indian economy is “benefitting from a large improvement in terms of trade” and “stronger external factors”. The Fund’s report also projected consumer price inflation to grow to 5.5% in 2016-’17, from 4.9% in 2015-‘16. It added that the country’s current account deficit will grow to 1.4% of GDP from 1.1% the previous year.

It also highlighted the need for the implementation of the Goods and Services Tax, which the central government plans to roll out by April, 2017. “This tax reform and the elimination of poorly targeted subsidies are needed to widen the revenue base,” the report said. However, the IMF called for more policy reforms by the government, including in the mining and labour market sectors, The Hindu Business Line reported. It further said that the Reserve Bank of India’s efforts to “strengthen bank balance sheets” was “critical for improving” lenders’ capacity to give loans.

The IMF’s revision came even as the RBI cut its repo rate – the rate at which it lends to commercial banks – by 25 basis points (or 0.25%) to 6.25% on Tuesday. In July, the IMF had cut its forecast for global growth by 0.1%, citing an increase in political and institutional uncertainty following the Brexit vote.