In its report, 'Asian Development Outlook (ADO) 2021', the ADB also noted that the recent surge in Covid-19 cases may put this recovery at risk.

"India's economy, meanwhile, is expected to grow 11.0 per cent in fiscal year (FY) 2021, which ends on 31 March 2022, amid a strong vaccine drive. However, the recent surge in COVID-19 cases may put this recovery at risk," it said.

India's GDP is expected to expand 7.0 per cent in the next financial year. This year, South Asia's GDP growth is expected to rebound to 9.5 per cent, following a 6.0 per cent contraction in 2020, before moderating to 6.6 per cent in the next year.

It added that the economic growth in developing Asia is set to rebound to 7.3 per cent this year, supported by a healthy global recovery and early progress on coronavirus disease (COVID-19) vaccines.

"Growth is gaining momentum across developing Asia, but renewed COVID-19 outbreaks pose a threat to recovery," said ADB Chief Economist Yasuyuki Sawada.

"Economies in the region are on diverging paths. Their trajectories are shaped by the extent of domestic outbreaks, the pace of their vaccine rollouts, and how much they are benefiting from the global recovery," the Chief Economist said.

As per the report, inflation in developing Asia is projected to fall to 2.3 per cent from 2.8 per cent last year, as food-price pressures ease in India and the People's Republic of China. The region's inflation rate is forecast to rise to 2.7 per cent in 2022.