NEW DELHI: India is leading the World Bank's growth chart for the first time and is poised to overtake China in 2015, a report by the multilateral agency has said.
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Growth in South Asia is expected to continue firming to 7.1% this year, led by a recovery in India and supported by a gradual strengthening of demand in high-income countries. The decline in global oil prices has been a major benefit for the region, leading to improvements in fiscal and current accounts, enabling subsidy reforms in some countries, and the easing of monetary policy," the report said.
In India, reforms are improving business and investor confidence and attracting capital inflows, and should help raise growth to 7.5% this year. Growth in China is on course to ease to 7.1% this year."With an expected growth of 7.5% this year, India is, for the first time, leading the World Bank's growth chart of major economies," said Kaushik Basu, World Bank chief economist and senior vice president after the release of the latest Global Economic Prospects (GEP) report.
Basu said slowly but surely the ground beneath the global economy is shifting. "China has avoided the potholes skillfully for now and is easing to a growth rate of 7.1%. Brazil, with its corruption scandal making s, has been less lucky, dipping into negative growth."
The main shadow over this moving landscape is of the eventual US liftoff, he said.
Developing countries face a series of tough challenges in 2015, including the looming prospect of higher borrowing costs as they adapt to a era of low prices for oil and other key commodities, resulting in a fourth consecutive year of disappointing economic growth this year, the report said. As a result, developing countries are now projected to grow by 4.4% this year, with a likely rise to 5.2% in 2016, and 5.4% in 2017.
"Developing countries were an engine of global growth following the financial crisis, but now they face a more difficult economic environment," said World Bank group president Jim Yong Kim.
With an expected lift in US interest rates, borrowing will become more expensive for emerging and developing economies over the coming months. This process is expected to unfold relatively smoothly since the US economic recovery is continuing and interest rates remain low in other major global economies.
www.sevagiri.com
Growth in South Asia is expected to continue firming to 7.1% this year, led by a recovery in India and supported by a gradual strengthening of demand in high-income countries. The decline in global oil prices has been a major benefit for the region, leading to improvements in fiscal and current accounts, enabling subsidy reforms in some countries, and the easing of monetary policy," the report said.
In India, reforms are improving business and investor confidence and attracting capital inflows, and should help raise growth to 7.5% this year. Growth in China is on course to ease to 7.1% this year."With an expected growth of 7.5% this year, India is, for the first time, leading the World Bank's growth chart of major economies," said Kaushik Basu, World Bank chief economist and senior vice president after the release of the latest Global Economic Prospects (GEP) report.
Basu said slowly but surely the ground beneath the global economy is shifting. "China has avoided the potholes skillfully for now and is easing to a growth rate of 7.1%. Brazil, with its corruption scandal making s, has been less lucky, dipping into negative growth."
The main shadow over this moving landscape is of the eventual US liftoff, he said.
Developing countries face a series of tough challenges in 2015, including the looming prospect of higher borrowing costs as they adapt to a era of low prices for oil and other key commodities, resulting in a fourth consecutive year of disappointing economic growth this year, the report said. As a result, developing countries are now projected to grow by 4.4% this year, with a likely rise to 5.2% in 2016, and 5.4% in 2017.
"Developing countries were an engine of global growth following the financial crisis, but now they face a more difficult economic environment," said World Bank group president Jim Yong Kim.
With an expected lift in US interest rates, borrowing will become more expensive for emerging and developing economies over the coming months. This process is expected to unfold relatively smoothly since the US economic recovery is continuing and interest rates remain low in other major global economies.
Source - TOI
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