India to see robust growth: ADB

By agencies   |   Wednesday, 06 April 2005, 19:30 IST
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NEW DELHI: The Indian economy will grow this year despite Tsunami battering parts of the country, while the economies of tsunami-ravaged Maldives, Sri Lanka and Thailand are expected to slow, the Asian Development Bank said Wednesday. The Manila-based bank said in its annual Asian Development Outlook that India's economy will grow 6.9 percent this year, up from 6.5 last year. "Despite the huge scale of loss of human life, homelessness and displaced populations, the macroeconomic impact of the disaster appears limited," the bank said. It also said that the tsunami's damage is "largely confined to rural areas rather than key economic and densely populated urban centers and industrial hubs." Nevertheless, it said, "The economic impact will be felt severely at the local and community levels, dragging a significant number of already poor people into deeper poverty." "The disconnection between the human cost and the limited macroeconomic impact is considerable with this particular disaster," the bank said. Epidemic outbreaks remain "a very significant risk" that could spoil the ADB's overall forecast of economic growth of 6.5-6.9 percent in 2005 through 2007 in developing Asia. Other risks include high oil prices, terrorism threat and the growing interdependence of regional economies. "Strong regional cooperation is absolutely vital in mitigating the risk of various epidemics. The tsunami that devastated coastal areas of the Indian Ocean left these areas vulnerable to epidemics," it said. "While the immediate economic consequences remain under control in many affected countries, poor sanitary conditions alongside the lack of sound health systems are risk factors for epidemic outbreaks of typhoid, hepatitis, diarrhea, and cholera across the region," the bank said.