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India to halve its poverty by 2015

China and South Asia are expected to halve their poverty by 2015, according to a World Bank report.

Current forecasts for 1998-2001 suggest that only these two regions will grow fast enough to halve poverty by 2015, says the World Development Indicators 1999, the WB's annual compilation of significant facts and figures.

The report says all developing regions have lost momentum in achieving their goals. India and China, which together account for 38 per cent of the world's population, have largely escaped the financial crisis that shook their Asian neighbours.

It, however, notes that after a generation of declining poverty, longer lives, and better health for millions of the world's poorest people, efforts to improve key areas of human development are now under threat.

Having opened to the global economy only recently, South Asia was insulated from the East Asian meltdown. However, its export growth and ability to raise project finance declined, compounded by the G-8 sanctions on India and Pakistan after they tested nuclear devices in May 1998, the document adds.

The sanctions were partly lifted in November 1998.

The report recalled how Pakistan came close to defaulting on its foreign debt, and its freezing of offshore accounts discouraged fresh inflows. Bangladesh was hit by floods.

It, however, says that the region's GDP growth slowed from 6.9 per cent in 1996 to five per cent in 1998. Even so, the region was a stabilising influence in Asia, it adds.

The World Bank says that regional GDP growth should recover to 5-6 per cent a year in the next decade. The main risks are domestic: more political will is needed to accelerate economic reforms, it says.

It says that faltering growth in Asia and Latin America, uncertain prospects for transition economies in the former Soviet Union, and the continuing spread of HIV/AIDS in Africa would make it increasingly difficult for the international community to achieve a series of key development goals for the early 21st century.

Developing countries, excluding the former Soviet Union, grew at a rate of 5.3 per cent from 1991-97, encouraging expectations that living standards would continue to rise in most regions of the world. However, the financial crisis, which began in Asia in 1997, has now tempered those expectations and could reverse the gains of many people who had previously migrated from poverty to the ranks of the middle class in the worst affected countries.

In eastern Europe and the countries of the former Soviet Union, millions of people have seen their living standards deteriorate sharply. In 1989, about 14 million people in the transition economies of the former Soviet Union were living under a poverty line of four dollars a day. By the mid-1990s, that number was about 147 million, or about one-person-in-three, the report says.

UNI

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