Risks IMF's Lagarde sees

"The first risk is what I have called “asynchronous monetary policy” in advanced economies—normalizing monetary policy in the United States and the United Kingdom while Japan and the Euro Area are increasing monetary stimulus. Even if this process is well managed, it may result in excessive volatility in financial markets.

The second risk is that the Euro Area and Japan could remain stuck in a “low growth-low inflation” gear for a prolonged period. This would make it harder for countries to reduce unemployment and excessive public and private debt, and raise the risk of recession and deflationary pressures around the globe.

The third risk is that emerging and developing economies could face a triple hit of a stronger U.S. dollar, higher global interest rates, and more volatile capital flows. A stronger dollar will have a significant impact on financial systems in emerging markets, including India, because many banks and companies have increased their borrowing in dollars over the past five years.

Of course, compounding these risks are geopolitical tensions that are simmering in different parts of the world."

Excerpts from 

Seizing India’s Moment

Christine Lagarde
Managing Director, International Monetary Fund
Lady Sri Ram College, New Delhi, March 16, 2015