Washington: Sharp slowdown in the Indian economy has weakened the growth rate of South Asia, the World Bank has said in a report.
According the Global Economic Prospects 2013, released on Tuesday, economic growth in the region dropped to an estimated 5.4 percent in 2012 from 7.4 percent the previous year.
This is mainly due to a sharp slowdown in India, where GDP growth is forecast at 5.4 percent in the fiscal year ending March 2013, the bank said
It added that weak global demand exacerbated region- specific factors, including subdued investment growth, electricity shortages, policy uncertainties, and a weak monsoon.
"Regional GDP is projected to grow by 5.7 percent in the 2013 calendar year, and by 6.4 and 6.7 percent in 2014 and 2015, respectively, driven by policy reforms in India, stronger investment activity, normal agricultural production, and improvement in export demand.
Growth in India (at factor cost) is projected at 6.4 percent in the 2013 fiscal year, rising to 7.3 percent by 2015," the report said.
According to the report, in India, the region's largest economy, growth measured in factor cost terms is projected to decelerate to 5.4 per cent in the 2012 fiscal year (ending in March 2013) from 6.5 percent in the 2011 fiscal year.
"Growth in Pakistan, the second largest economy in the region, remained broadly stable at a projected 3.8 percent in the 2012-13 fiscal year compared with 3.7 percent in 2011-12.
Bangladesh's growth is projected to slow to 5.8 percent in 2012-13 (6.3 percent in 2011-12) and Nepal's growth to 3.8 percent in 2012-13 (4.6 percent in 2011-12)," it said.
Sri Lanka's GDP growth slowed to an estimated 6.1 percent in 2012 (8.3 percent in 2011).
In contrast, Afghanistan's economy grew robustly by about 11 percent mostly due to a good harvest, the report said.