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India’s economy set to fall behind Pakistan, rest of South Asia as COVID-19 surges

  • A new report says that Pakistan, Bangladesh and Sri Lanka’s COVID-19 approaches are working better than India, making it easier for these countries' economies to recover quickly.
22 Sep 2020

India has failed to contain the spread of the COVID outbreak. The outbreak’s implications are going to be huge for the country with the economy bearing the brunt of the pandemic’s fallout.

As of now, COVID-19 cases in India have crossed 5 million and there is no evidence to suggest whether the surge has reached its peak yet. India has the second-highest number of COVID-19 cases globally, after the US.

A report by the Capital Economics Ltd has warned that India’s approach has been ineffective in dealing with the crisis, meaning the virus’s surge will see the country’s economy lagging behind the rest of South Asia.

“New cases per capita in these three economies are far lower than in India,” Shilan Shah, senior economist at Capital Economics in Singapore told the Print. “This has enabled a faster rebound in activity.”

The report further said that the pandemic’s impact on Bangladesh, Pakistan and Sri Lanka’s gross domestic product is not going to be stern as these countries have done well to contain the crisis. However, India is expected to “post a double-digit slump” as the country’s economy comes under huge pressure due to shutdowns.

On the other hand, Pakistan has fared well with the smart lockdown strategy. According to Our World in Data figures, Pakistan has made real progress in getting the virus under control. Islamabad’s approach to containing the virus has also been lauded by the World Health Organization and other organizations globally.

“Pakistan’s timely response to Covid-19 is the best in the region but it still needs to enhance testing of people and strictly observe physical distancing measures, wearing masks and washing hands, especially during the upcoming Eidul Azha,” Dr Palitha Mahipala, the WHO country chief said.