Global Economic Prospects: World Bank

In News

Recently, the World Bank has released its June 2021 Global Economic Prospects Report.

Major Findings 

• Indian scenario 
  • India’s economy is expected to grow at 8.3% for Fiscal Year 2021-22.
    • This rate, however, masked the damage caused by the “enormous” second wave of COVID-19.
  • For FY 2022-23 growth is expected to slow to 7.5% as a result of the pandemic’s lingering effects on the balance sheets of households, companies and banks and possibly low levels of consumer confidence and heightened uncertainty around job and incomes.
• Global Scenario 
  • The world economy is expected to expand 5.6% , the fastest post-recession growth rate in eighty years, but global output will still be 2% below pre-pandemic projections by year-end.

                                              Image Courtesy :BS

  Issues /Challenges

• Progress in vaccination has been slow, and the largest economies, Bangladesh, India, and Pakistan, have vaccinated only a small fraction of their populations.
• COVID-19 cases have surged in South Asia and the situation in India has been particularly difficult. 
•  The effects of the pandemic have reversed poverty reduction gains and aggravated insecurity and other long-standing challenges.

Initiatives Taken by India

• The RBI has announced  a series of measures to support the nation’s fight against the second wave of COVID-19 infections.
• Fiscal policy shifted in the FY 2021/22 budget toward higher expenditure targeted at healthcare and infrastructure to boost the post-pandemic recovery.

Conclusion and Way Forward 

• Globally coordinated efforts are essential to accelerate vaccine distribution and debt relief, particularly for low-income countries.
• As the health crisis eases, policymakers will need to address the pandemic’s lasting effects and take steps to spur green, resilient, and inclusive growth while safeguarding macroeconomic stability.
• There is a need to spend higher spending on infrastructure, rural development, and health.

Source :TH