Economic and Social Survey of Asia and the Pacific 2021: UNESCAP

• 01 Apr 2021

Why in News

A report ‘Economic and Social Survey of Asia and the Pacific 2021: Towards post-Covid-19 resilient economies’ has recently been released by the United Nations Economic and Social Commission for Asia and the Pacific (UNESCAP).

• According to the report, India is estimated to record an economic growth of 7% in 2021-22, over a contraction of 7.7% witnessed in the previous fiscal on account of the pandemic’s impact on normal business activity.

Key Points

• Other Observation Regarding India:
  
  • India’s 2021 economic output, however, is expected to remain below the 2019 level despite a robust reduction in new Covid-19 cases and the start of vaccine roll-out.
  • India entered the pandemic with already subdued GDP (Gross Domestic Product) growth and investment.
    
    • Moreover, one of the most stringent lockdowns in the world caused the severe economic disruptions that the country experienced in the year 2020.
  • A subsequent change in lockdown policies and success in reducing infection rates supported an impressive economic turnaround in the later months of 2020.
• Challenges: The report mentions two major challenges for India on its path to faster recovery.
  
  • Maintaining low borrowing costs, and
  • Keeping non-performing loans in check.
• Observation Regarding Asia Pacific Countries:
  
  • The socio-economic impact of the Covid-19 pandemic was amplified due to lack of resilience and investments in people and the planet.
  • China’s swift and effective response to Covid-19 enabled it to become the only major economy worldwide to achieve a positive annual economic growth rate in 2020.
  • On an average, developing Asia-Pacific economies are expected to grow 5.9% in 2021 and 5% in 2022.
  • The prospect of a K-shaped recovery, characterized by uneven post-pandemic recovery across countries and widened inequality gaps within countries, is highlighted as a primary policy challenge.

K-Shaped Recovery

• A K-shaped recovery occurs when, following a recession, different parts of the economy recover at different rates, times, or magnitudes. This is in contrast to an even, uniform recovery across sectors, industries, or groups of people.
• A K-shaped recovery leads to changes in the structure of the economy or the broader society as economic outcomes and relations are fundamentally changed before and after the recession.
• This type of recovery is called K-shaped because the path of different parts of the economy when charted together may diverge, resembling the two arms of the Roman letter "K."

• Suggestions:
  
  • For a more robust and inclusive recovery, the report calls for a more synchronised Covid-19 vaccination programme across countries. There is a need to leverage regional cooperation.
  • It recommends that fiscal and monetary support should be sustained, as premature tightening could increase long-term scars.
  • Continuity in policy support is a must and recovery policy packages should focus on building resilience and investing in the 2030 Agenda for Sustainable Development.
  • To deal with various economic and non-economic shocks, a more integrated risk management approach to planning and policymaking is needed.

Economic and Social Survey of Asia and the Pacific

• Produced annually since 1947, the Economic and Social Survey of Asia and the Pacific is the oldest United Nations report on the region’s progress.
• The Survey monitors regional progress, provides cutting-edge analyses and guides policy discussion on the current and emerging socio-economic issues and policy challenges to support inclusive and sustainable development in the region.
• Since 1957, the Survey has also contained a study or studies focusing on a significant aspect or challenge relevant to the economies of the Asia-Pacific region.
• The Survey of 2021 studies the impact of Covid-19 pandemic and provides insights for post-Covid-19 resilient economies.

United Nations Economic and Social Commission for Asia and the Pacific

• The United Nations Economic and Social Commission for Asia and the Pacific (UNESCAP) is the regional development arm of the United Nations for the Asia-Pacific region.
• It has 53 Member States and 9 Associate Members from Asia-Pacific Region including India.
• Established: 1947
• Headquarters: Bangkok, Thailand
• Objective: To overcome some of the region’s greatest challenges by providing results-oriented projects, technical assistance and capacity building to member States.

Source:IE