The economy of the South Asian region is expected to grow by 7.2 percent in 2021 and 4.4 percent in 2022, the World Bank said in a report, adding the countries in the region are recovering but it remains “fragile.”
The economy of the South Asian region is expected to grow by 7.2 percent in 2021 and 4.4 percent in 2022, the World Bank said in a report, adding the countries in the region are recovering but it remains “fragile.” Significantly, the World Bank revised its growth upward for Nepal, Bangladesh, and Pakistan given the good remittance flow in these countries. The GDP of Bangladesh is likely to increase by 3.6 percent in the year 2021-22, it says. India, on the other hand, is expected to grow by 10.1 percent, Nepal 2.7 percent, Pakistan 1.3 percent. However, Bhutan is projected to record a negative growth rate of 1.3 in 21-22.
The report says that growth is uneven and economic activities remain well below pre-COVID-19 estimates, as many businesses need to make up for lost revenue and millions of workers -- most of them in the informal sector -- are still reeling from job losses, falling incomes, worsening inequalities, and human capital deficits.
The report, titled South Asia Economic Focus, Spring 2021: South Asia Vaccinates, said the region will regain its historic growth by 2022, and the recovery is indicated by the consumption of electricity and mobile data.
"We are encouraged to see clear signs of an economic rebound in South Asia, but the pandemic is not yet under control and the recovery remains fragile, calling for vigilance," Hartwig Schafer, World Bank Vice President for the South Asia Region, was quoted as saying by the Himalayan Times.
However, the limited health infrastructure in the region may pose challenges in the coming weeks as almost all countries in South Asia are seeing a rise in Covid-19 cases. Governments need to speed up vaccination pace to avoid disruptions.