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Worst recession in South Asia; millions falling into poverty: World Bank

India, the region's biggest economy, is likely to see its economy contract by 9.5% this year, the World Bank report said

Topics
poverty | South Asia | Lockdown

Reuters  |  NEW DELHI 

Poverty, jobs
With 6.84 million people infected, India's Covid-19 caseload is second only to the US.

Millions of people in are being pushed into extreme as the region where a quarter of humanity lives suffers its worst-ever due to the devastating impact of the pandemic, the World Bank said on Thursday.

The multi-lateral lender forecast a record economic contraction of 7.7% for this year, and said workers in the informal sector were being hit hardest, and private consumption was unlikely to recover quickly from the blow.

"The impact on livelihoods will even be larger than the GDP forecast suggests...This implies that the region will experience a sharp increase in the rate," the bank said in its bi-annual report.

India, the region's biggest economy, is likely to see its economy contract by 9.5% this year, the report said.

The report warned that South Asia's economies could end up worse than the forecast as the pandemic continues to surge, making foreign investors more wary, limiting governments' ability to increase spending and putting more strain on banking systems already heavily burdened with bad loans.

With 6.84 million people infected, including 105,000 dead, India's COVID-19 caseload is second only to the United States, despite the country going under the strictest in the initial phase of the pandemic in March.

Pakistan and Bangladesh have recorded over 317,000 cases each, while the rest of the countries in the region have combined total of over 149,000 cases.

(Reporting by Aftab Ahmed in New Delhi; Editing by Simon Cameron-Moore)

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First Published: Thu, October 08 2020. 13:43 IST
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