Sunday, 08 October 2017 - 13:49
South Asia region’s growth declines


After leading global growth for two years, South Asia has fallen to second place, after East Asia and the Pacific.

The region’s slowdown is due to both temporary shocks and longer-term challenges.

Regional economic growth is expected to slow to 6.9 percent in 2017 from 7.5 percent in 2016, but growth could be rebound to 7.1 percent in 2018 with the right mix of policies and reforms. 

The just-released twice-a-year South Asia Economic Focus (SAEF) finds that the slowdown in South Asia has mostly been driven by internal factors, most notably in India, such as a decrease in private investment, and an increase in imports and government spending.

This edition, Growth out of the Blue, explores the potential of night-time light satellite imagery to improve measurement and understanding of economic activities.                                

“While growth rates in South Asia largely remain robust given the economic shocks that some countries in the region have faced, countries should continue to actively address their growing trade and fiscal deficits,” said Annette Dixon, the World Bank South Asia Region Vice President.

Given its weight in the region, India sets the pace for South Asia. Its Gross Domestic Product (GDP) growth is expected to slow down to 7.0 percent in 2017, due to surging imports and declining private investment along with the effects from withdrawing large amounts of banknotes and the introduction of the Goods and Services Tax (GST).

However, India’s growth is expected to rebound to 7.3 percent in 2018.

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