International Monetary Fund (IMF) Managing Director Christine Lagarde on Saturday urged Asian nations to employ growth-friendly monetary and fiscal policies to counter challenges posed by a fragile global economy.

The call comes as policymakers the world over are struggling to revive their economies, which have been buffeted by slowing productivity and high debt.

Central banks in Europe and Japan have resorted to negative interest rates to stimulate consumer demand and perk up worryingly low inflation. But the strategy has added to the volatility in the financial markets and raised the specter of competitive currency devaluation.

The multilateral lender earlier this week warned of a further downgrade to the global growth outlook on increasing risks of economic derailment.

"What should be Asia's response?...It is safe to say that structural reforms are key — to boost competitiveness, growth, and jobs," Lagarde told a conference jointly hosted by the IMF in New Delhi.

In January, the IMF projected global growth of 3.4 percent and 3.6 percent in 2016 and 2017, respectively, having revised down its October forecast for both years by 0.2 of a percentage point.

The third downgrade in less than a year was triggered by China's worst slowdown in 25 years that has exposed vulnerabilities in the country's corporate and financial sector.

Lagarde said Beijing should improve credit allocation to rebalance the economy away from debt-fuelled investment.