World Bank maintains India's growth projection at 8.3% for 2021-22

12 Jan 2022 , 10:18 AM

According to World Bank’s “Global Economic Prospects” report, the Indian economy is expected to grow at 8.3 per cent this fiscal and at 8.7 per cent in 2022-23. According to the report, the growth rate of the Indian economy in the current and next fiscal will be stronger as compared to its immediate neighbours.

Bangladesh is expected to grow at 6.4 and 6.9 per cent in 2021-22 and 2022-23, respectively, while Nepal’s growth is expected to be at 3.9 per cent this fiscal and at 4.7 per cent in the next financial year. Pakistan’s economy will grow by 3.4 per cent in the current fiscal and at 4 per cent in 2022-23, the World Bank said in its ‘Global Economic Prospects report released on January 11.

Following a strong rebound in 2021, the global economy is entering a pronounced slowdown amid fresh threats from COVID-19 variants and a rise in inflation, debt, and income inequality that could endanger the recovery in emerging and developing economies, according to the World Bank’s latest Global Economic Prospects report.

Global growth is expected to decelerate markedly from 5.5 per cent in 2021 to 4.1 per cent in 2022 and 3.2 per cent in 2023 as pent-up demand dissipates and as fiscal and monetary support is unwound across the world.

The rapid spread of the Omicron variant indicates that the pandemic will likely continue to disrupt economic activity in the near term. In addition, a notable deceleration in major economies–including the United States and China–will weigh on external demand in emerging and developing economies. At a time when governments in many developing economies lack the policy space to support activity if needed, new COVID-19 outbreaks, persistent supply-chain bottlenecks and inflationary pressures, and elevated financial vulnerabilities in large swaths of the world could increase the risk of a hard landing, the report said.

“The world economy is simultaneously facing COVID-19, inflation, and policy uncertainty, with government spending and monetary policies in uncharted territory. Rising inequality and security challenges are particularly harmful for developing countries,” said World Bank Group President David Malpass. “Putting more countries on a favourable growth path requires concerted international action and a comprehensive set of national policy responses.”