Unveiling its forecasts at the World Economic Forum in Davos, Switzerland, the fund left its prediction for US growth this year unchanged at 2.5 per cent. In 2020, India is projected to grow at 7.7 per cent. The IMF said while the Chinese growth rate has been on a downward slope India has experienced an upward trajectory in these years.
Growth expectations were downgraded for both 2019 and 2020 to 3.5pc and 3.6pc respectively by the Washington-based organisation, as it presented its update on the global economy at the World Economic Forum in Davos, Switzerland.
Underscoring the wobbly state of the global economy: China, the world's second-biggest economy, on Monday reported 2018 growth of 6.6 percent, the weakest since 1990.
"Policymakers need to act now to reverse headwinds to growth and to prepare for the next downturn", she said.
The downgrades reflected signs of weakness in Europe, with its export powerhouse Germany hurt by new fuel emission standards for cars and with Italy under market pressure due to Rome's recent budget standoff with the European Union.
The fund left its prediction for US growth this year unchanged at 2.5 percent - though a continuation of the partial 31-day shutdown of the federal government poses a risk.
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The IMF in its January World Economy Outlook update on Monday said India would remain the fastest growing major economies of the world. It is projected to grow at 7.5 per cent this year and 7.7 per cent in 2020, an impressive over one percentage point ahead of China's estimated growth of 6.2 per cent in these two years.
Growth in emerging-market countries is forecast to slow to 4.5 percent from 4.6 percent in 2018.
"Emerging market and developing economies have been tested by hard external conditions over the past few months amid trade tensions, rising USA interest rates, dollar appreciation, capital outflows, and volatile oil prices", the International Monetary Fund said.
"As seen in 2015-16, concerns about the health of China's economy can trigger abrupt, wide-reaching sell-offs in financial and commodity markets that place its trading partners, commodity exporters, and other emerging markets under pressure", the International Monetary Fund said in the report.
The IMF has been urging policymakers to carry out structural reforms while the global economy enjoys solid growth, with its managing director, Christine Lagarde, telling them to "fix the roof while the sun is shining".
The IMF's growth outlook for the 19 countries that use the euro currency has been reduced to 1.6 per cent from 1.8 per cent. The IMF has stressed the need to address income inequality and reform the financial sector.