As COVID-19 continues to challenge economies around the globe, China’s economy has cooled while India could become the world’s fastest growing economy. China released data showing the country’s economy slowed sharply in the second quarter, largely due to a zero-COVID policy and lockdowns.

China’s gross domestic product grew 0.4% from April to June 2022. It had grown almost 5% in the first quarter. 2022’s second quarter growth is the worst showing for the word’s second-largest economy since 1992, excluding the almost 7% contraction in the first quarter of 2020 when the initial COVID-19 shock set in.

The Chinese government imposed full or partial lockdowns in several major cities in March and April, including in the country’s commercial capital of Shanghai.

Increasing inflation, the fear of more lockdowns, and the rise of the new COVID-19 BA.5 variant are causing concern for many Chinese consumers and businesses. Some economists, however, said the worst of the pandemic is over and inflation may have just peaked, ruling out the possibility of a recession in China.

This same sort of optimism is taking hold elsewhere on the Asian continent.

In India, the country’s reserve bank said in a statement the economy there is on pace to become the world’s fastest growing.

The Reserve Bank of India said the country has benefited from a good monsoon season, and an increase in planting is raising expectations that rural demand will soon catch up with urban spending and consolidate a recovery.

The RBI also said if commodity prices continue to moderate like they have in recent weeks, and if supply chain wrinkles can get ironed out, then the worst of the recent surge in inflation will be over.

While the RBI seemed confident in its assessment, it did not offer any time frames.

Reuters contributed to this report.