"In India, while near-term growth prospects remain favourable and external vulnerabilities have decreased, some macroeconomic imbalances remain," IMF said in its report 'Global prospects and policy challenges' meant for the G-20 meeting of finance ministers in Ankara.
    
"While the faster-than-expected fall in inflation has created space for considering modest cuts in the nominal policy rate, medium term inflationary pressures and upside risks to inflation remain," the report said.

With balance sheet strains in the corporate and banking sectors, financial sector regulation in India should be enhanced, provisioning increased, and debt recovery strengthened, it said.
    
According to the report, global growth in the first half of 2015 was lower than in the second half of 2014, reflecting a further slowdown in emerging economies and a weaker recovery in advanced economies.

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