The international body lowered its estimate for India, the region’s largest economy, to 8.0 percent for the current fiscal year to March 2023 from 8.7 percent, The Express Tribune newspaper reported.
It also lowered the growth outlook for South Asia ex-Afghanistan by one percentage point to 6.6 percent.
In India, household consumption will be limited by the incomplete post-pandemic recovery of the labor market and inflationary pressures, according to the bank.
High oil and food prices caused by the crisis in Ukraine will have a severe negative impact on the population’s real income, Hartwig Schäfer, World Bank vice president for South Asia, said in a statement.
The agency raised its growth forecast for Pakistan, the region’s second largest economy, for the current year ending June to 4.3 percent from 3.4 percent and left the forecast for next year unchanged at 4.0 percent.
The region’s dependence on energy imports has meant that high crude oil prices have forced their economies to rebalance monetary policies to focus on inflation, rather than reviving economic growth after nearly two years of restrictions imposed by the Covid-19 pandemic. 19, he noted.
In addition, the World Bank lowered the growth forecast for the Maldives for this year from 11 percent to 7.6 percent, citing large imports of fossil fuels and declining tourist arrivals from Russia and Ukraine.
However, he raised the growth forecast for crisis-hit Sri Lanka to 2.4 percent from 2.1 percent but warned that the island’s prospects are highly uncertain due to fiscal and external imbalances.
Sri Lanka’s central bank said on Tuesday it has become impossible to repay foreign debt as the country seeks to use its dwindling foreign exchange reserves to import essential goods and fuel.
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