Recovery may remain weak for India among Asian peers

HYDERABAD: India has the lowest growth recovery score among Asian nations, while its stringent lockdown and weak policy support threaten to amplify the country’s inherent economic fragilities, finds the latest Oxford Economics study.

On the other hand, recovery prospects look brightest for Vietnam, despite its modest fiscal efforts as its effective containment of coronavirus outbreak allows it a fast and effective re-opening. To determine the speed of growth recovery, Oxford built a scorecard comprising 4 stringency indicators, 12 vulnerability indicators, 2 containment indicators, and 9 macro policy indicators and categorised the countries into three buckets.  

Sadly, India stood at the bottom of the bucket, though it has Philippines, and Indonesia for company. All three economies, the study noted, were struggling to get past the peak of the pandemic, and hence a major headwind to their growth outlooks. Making matters worse, fiscal policy response was meagre in both India and Philippines, especially compared to the stringency of lockdowns, noted Priyanka Kishore, Head of India and South East Asia Economics, Oxford Economics.

At the top was North Asia comprising China, Vietnam and South Korea that successfully contained the virus. Particularly, China appears favourably positioned, despite its weakest policy response within the region. Similarly, Vietnam and South Korea have the added advantage of achieving high containment scores without a very stringent lockdown for a prolonged period. In the middle stood Singapore, Malaysia, and Thailand.

Despite a massive fiscal response, Singapore’s recovery prospects were held back by a prolonged lockdown and still-elevated daily counts of Covid-19 cases. Both Thailand and Malaysia score better  offsetting their weaker policy scores to a large degree.