India and other countries in South Asia are likely to report their worst growth output this year in 40 years as a result of the coronavirus pandemic, the World Bank disclosed late Sunday.
India's economy, the largest in the region, is projected to rise from 1.5 percent to 2.8 percent in the fiscal year that began April 1. The World Bank has forecast that in the fiscal year ending on March 31, it will rise 4.8 percent to 5 percent.
The eight-country South Asian region is expected to see economic growth of 1.8 percent to 2.8 percent this year, the World Bank said in its South Asia Economic Focus survey, well below the 6.3 percent it estimated six months ago.
In its bi-annual regional update, the bank reported that South Asian governments need to step up efforts to contain the health crisis, safeguard their populations, particularly the marginalized and weak, and set in motion a rapid economic recovery.
The latest 'South Asia Economic Focus' anticipates a rapid economic downturn in each of the eight countries in the region, triggered by a halt to economic development, trade disruption, and greater stress in the financial and banking sectors.
The pandemic will strike South Asia very hard, and the region's substantial gains in poverty alleviation are likely to be wiped out, cautioned the study.
India, Afghanistan, Bangladesh, Pakistan, and other smaller economies with 1.8 billion people and some of the most heavily populated regions in the world have so far recorded relatively few cases of the disease, but experts are worried they could emerge as the next hotspots.
There is already much evidence of the devastating economic consequences, with widespread lockdowns freezing most daily life, Western production orders cancelled and large numbers of poor employees suddenly being rendered jobless.
South Asia is in "a perfect storm" of adverse consequence, with tourism falling and supply chains fragmented, demand for clothing declining and expectations of customers and investors deteriorating," a World Bank study said.
The harsh reality of inequality in South Asia is that poor people are more likely to get infected with coronavirus, because social distancing is hard to enforce for them, the World Bank stated, adding that they would also be the most vulnerable to work cuts and food price increases.
Home to one-quarter of the world's population, South Asia has in recent decades pulled millions out of poverty, but an economic downturn of the magnitude it now faces could reverse many of those gains.
