MANILA, Sept 30: South Asian countries seem poised to enjoy renewed growth in 2003 and 2004 as weather conditions normalize and their political situations stabilize, the Asian Development Bank said Tuesday.
The ADB, in a newly-released report, said that South Asia would post GDP growth of 5.8 per cent this year, a slight increase from the 5.7 per cent estimated earlier.
The GDP growth forecast in 2004 was maintained at 6.1 per cent, the Asian Development Outlook report said.
Pakistan showed a sharp improvement, with GDP growth forecast at 5.1 per cent this year and 5.0 per cent next year compared to 3.4 per cent growth last year, the ADB said, crediting this to an expansion in large-scale manufacturing, a revival in major crops and a strengthened services sector.
This in turn, was attributed to the better weather conditions, strong export performance and the result of macroeconomic and structural reforms undertaken in recent years.
The large share of agriculture in the economies of South Asian nations make them vulnerable to adverse weather conditions, which hurt India, Bangladesh and Nepal in 2002 when overall GDP growth was only 4.2 per cent, the ADB said.
However, better weather conditions and strengthened external and domestic demand herald improved growth even as inflation remains moderate, the bank said.
India meanwhile is poised to bounce improve on the 4.3 per cent GDP growth in 2002 to hit six per cent this year and 6.3 per cent next year, the ADB said, citing normal weather conditions, strong manufacturing growth and a resurgence in exports and construction.
Most of the other South Asian countries will also enjoy better growth in 2003 and 2004, the multilateral institution said.
The outbreak of the Severe Acute Respiratory Syndrome (Sars) and the effects of the Iraq war did not severely hamper growth in the region, the Manila-based lender said.
However, it warned that prospects in Nepal and Sri Lanka remain highly dependent on the security situation and the peace process with insur-gent groups in those countries.—AFP