ISLAMABAD: With the lowest GDP growth of 0.5 per cent among all South Asian nations, the World Bank (WB) has warned Pakistan about external financing risks that could be compounded by difficulties in rolling-over bilateral debt from non-traditional donors and tighter international financing conditions.
The WB’s report on South Asia reveals that regional growth was expected to rebound to 4.5 per cent in FY21 against -7.7 per cent in the last fiscal year.
Afghanistan’s growth is now projected at 2.5 per cent, Maldives 9.3 per cent, Sri Lanka 3.3 per cent, Bangladesh 1.6 per cent, Bhutan 0.6 per cent, Pakistan 0.5 per cent and India 5.4 per cent in FY21. India’s economy had contracted by 9.6 per cent in FY20.
The report stated that there are considerable downside risks to the outlook of Pakistan’s economy, with the most significant being a possible resurgence of the coronavirus, triggering a new wave of global and/or domestic lockdowns and further delaying the implementation of critical structural reforms.
“Locust attacks and heavy monsoon rains could lead to widespread crop damage, food insecurity and inflationary pressures, and livelihoods for households dependent primarily on agriculture could also be negatively impacted,” the WB has warned.
