Human development pressures across Asia widening: UNDP report
United Nations: The conflict and military escalation in West Asia threatens to push 2.5 million people in India into poverty and the country is projected to experience some loss in its human development progress, according to estimates and projections by the United Nations.
The United Nations Development Programme (UNDP), in a report titled ‘Military Escalation In The Middle East: Human Development Impacts Across Asia And The Pacific’ noted that the conflict is “widening human development pressures across Asia and the Pacific”.
“Through higher fuel, freight and input costs, the shock is diminishing household purchasing power, raising food insecurity, straining public budgets and weakening livelihoods,” the report said.
The preliminary assessment, issued Tuesday, estimates that globally 8.8 million people are at risk of falling into poverty and the West Asia military escalation could cost Asia-Pacific up to $299 billion. In India, poverty is expected to rise from around 4,00,000 to 2.5 million, the report said.
It added that the number of people pushed into poverty in the world as a result of the conflict rises from approximately 1.9 million to nearly 8.8 million across scenarios, with South Asia accounting for the largest share, ranging from about 1.7 million to over 8 million, reflecting both the sub-region’s population size and its higher exposure to income and price shocks.
China is estimated to experience a more moderate increase in the number of people at risk of falling into poverty, from around 1,15,000 to over 6,20,000, reflecting small proportional changes applied to a very large population base.
Highlighting the estimated poverty impact of the military escalation (28-day conflict, most severe scenario with 8-month adjustment), the report said that India’s poverty rate is estimated to rise to 24.2% post-crisis from 23.9%, pushing 24,64,698 people into poverty.
An estimated 35,40,33,698 people are projected to live in poverty in the country post-crisis as compared to 35,15,69,000 pre-crisis.
The UNDP simulation estimates the impact of the conflict on the Human Development Index (HDI) for countries across the region. It indicates that Iran’s HDI could decline by an amount equivalent to roughly one to one and a half years of human development progress.
The report notes that among the region’s larger importers, India meets over 90% of its oil needs through imports, sourcing more than 40% of crude imports and 90% of LPG imports from West Asia.
Further, West Asian countries supply over 45% of India’s fertiliser imports, while 85% of the country’s domestic urea production depends on imported regasified liquefied natural gas.
The shock of the conflict is also influencing energy choices in several countries. With LNG prices rising, some economies, including India, Thailand, the Philippines and Vietnam have increased their reliance on coal-fired power.
On trade and supply chain disruptions, UNDP country-level analysis indicated significant impacts in 25 out of 36 countries through freight surcharges, war-risk insurance premia, route diversions, and delayed delivery of intermediate and consumer goods.
India’s assessment shows that West Asian markets account for 14% of exports and 20.9% of imports, with roughly $48 billion in non-oil exports, particularly in basmati rice, tea, gems and jewellery, and apparel. Bangladesh also reports significant disruption as Gulf carriers cancelled flights, shipments from Bangladesh and India were stranded, it said.
