India is a lead in the World Bank’s growth chart for the first time and it is all set to overtake China in 2015. Growth in South Asia is expected to continue leading to 7.1% this year, led by a recovery in India.

In India, reforms are improving business and investor confidence and attracting capital inflows, and should help raise growth to 7.5% this year. Growth in China is on course to ease to 7.1% this year.

The decline in global oil prices has been a major benefit for the South Asian region, driving improvements in fiscal and current accounts, enabling subsidy reforms and facilitating the easing of monetary policy, the report said.

With an expected lift in US interest rates, borrowing will become more expensive for emerging and developing economies over the coming months. This process is expected to unfold relatively smoothly since the US economic recovery is continuing and interest rates remain low in other major global economies.