NEW DELHI/LONDON, Oct 10 (Reuters) - The World Bank has increased its growth forecast for South Asia to 6.4% in 2024, up from 6.0%, highlighting the robust domestic demand in India and the recovery in crisis-affected countries such as Sri Lanka and Pakistan.
India's economic growth for the current fiscal year, ending in March 2025, is now projected at 7%, a rise from the previous estimate of 6.6%, supported by a rebound in agricultural output and increased private consumption.
According to Martin Raiser, World Bank Vice President for South Asia, the region is witnessing the fastest growth among emerging economies, driven by an emerging consumer class in India and recoveries in neighboring countries. He noted, “You have an emerging class of consumers in India that's driving the economy forward.”
The World Bank also forecasts that South Asia will achieve a strong 6.2% growth annually over the next two years, contingent upon continued economic reforms and greater integration into the global economy.
India's central bank has maintained its GDP growth forecast at 7.2% for the current fiscal year. Meanwhile, Pakistan's economy is expected to grow by 2.8%, up from 2.3%, aided by a recovery in manufacturing. Sri Lanka, recovering from a severe economic crisis, has seen its growth forecast revised significantly to 4.4% for this year.
Conversely, Bangladesh's growth forecast has been downgraded to 4.0% from 5.7%, reflecting a slowdown in garment exports amid recent social unrest. The World Bank also emphasized the need to boost women's labor force participation in the region, which is currently the lowest globally at 32%. Increasing women's employment could potentially raise economic output by up to 50% in the long term.
Reporting by Manoj Kumar. Source: Reuters.