The US Treasury lauded economic reforms outlined by the Indian government, which is seemingly undeterred by the International Monetary Fund’s gloomy projection for the country’s growth rate.

The IMF downgraded India’s GDP growth forecast for 2012 to 4.9%, the first time it slipped below 5% in a decade. US Treasury secretary Tim Geithner, during a a cabinet-level meeting on US-India economic ties in New Delhi, welcomed India’s reforms, saying they offer “a very promising path to improving the growth outcomes for the Indian economy,” the Financial Times reports.

India recently allowed majority ownership to foreign companies in an attempt to pave the way for foreign investment. The government said that it is also seeking to expand foreign ownership to sectors from commercial aviation to insurance. Mr. Geitner told the Financial Times that the reforms would help restore investor confidence in India.

“Without reforms, we risk a sharp and continuing slowdown of the economy, which we cannot afford given the imperative need to generate jobs and incomes for a large population, most of whom are young,” Indian finance minister Palaniappan Chidambaram said at a news conference.