Corona Update: India and other South Asian countries to face worst economic slump in 40 years, says World Bank

INDIA: India and other South Asian countries are likely to record their worst growth performance in four decades this year due to the coronavirus outbreak, the World Bank said on Sunday.

The South Asian region, comprising eight countries, is likely to show economic growth of 1.8% to 2.8% this year, the World Bank said in its South Asia Economic Focus report, well down from the 6.3% it projected six months ago.

India’s economy, the region’s biggest, is expected to grow 1.5% to 2.8% in the fiscal year that started on April 1. The World Bank has estimated it will grow 4.8% to 5% in the fiscal year that ended on March 31.
Other than India, the World Bank forecast that Sri Lanka, Nepal, Bhutan and Bangladesh will also see sharp falls in economic growth.
Three other countries – Pakistan, Afghanistan and the Maldives – are expected to fall into recession, the World Bank said in the report, which was based on country-level data available as of April 7.

If we talk in context of India then Covid-19 outbreak came at a time when India’s economy was already slowing, due to persistent financial sector weaknesses, the report said.The World Bank on Sunday said the coronavirus outbreak has severely disrupted the Indian economy, magnifying pre-existing risks to its outlook.

In its South Asia Economic Update: Impact of Covid-19, the World Bank estimated the Indian economy to decelerate to 5 per cent in 2020 and projected a sharp growth deceleration in fiscal 2021 to 2.8 per cent in a baseline scenario.

In a conference call with reporters, World Bank Chief Economist for South Asia Hans Timmer said India’s outlook is not good. And if the domestic lockdown is prolonged, then the economic result can be much worse than what the World Bank has in its baseline range of forecasts.

Among the steps that India can take to address this challenge, Timmer said the first step is to focus on mitigating the spread of the disease, and to make sure that everybody has food