Despite global economic slowdown, South Asia is projected to grow by 5.6% in 2026 and 5.9% in 2027, according to the United Nations’ World Economic Situation and Prospects (WESP) 2026. Strong domestic demand, supportive policies, and resilience in key economies provide silver linings amid trade tensions and debt challenges.
The United Nations’ WESP 2026 report highlights South Asia as one of the few regions maintaining robust growth prospects despite global headwinds. While worldwide output is expected to slow to 2.7% in 2026, South Asia’s GDP expansion of 5.6% underscores its relative resilience.
Key drivers include supportive fiscal policies, rising domestic consumption, and investment in infrastructure and technology. Countries like India, Bangladesh, and Sri Lanka are expected to anchor regional momentum, even as challenges such as trade barriers, debt vulnerabilities, and policy uncertainty persist.
Experts emphasize that South Asia’s performance will be critical in sustaining global growth, particularly as advanced economies face stagnation.
Notable Updates / Major Takeaways
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Growth Forecast: South Asia GDP to expand by 5.6% in 2026, 5.9% in 2027.
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Global Context: World output projected at only 2.7% in 2026.
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Regional Drivers: Strong domestic demand, supportive policies, infrastructure investments.
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Challenges: Rising trade barriers, debt risks, and policy uncertainty.
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Strategic Importance: South Asia remains a key engine of global growth.
Sources: United Nations World Economic Situation and Prospects (WESP) 2026; Reuters Global Economy Desk; ESCAP News