Regions and Countries

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p. 27 of 47 BACK | NEXT Developing Asia and the Pacific The global economy Newly industrialized economies Central Asian republics, Azerbaijan and Mongolia People’s Republic of China Southeast Asia South Asia Bangladesh Bhutan India Maldives Nepal Pakistan Sri Lanka The Pacific

South Asia

South Asia sustained its growth in 2000, with aggregate GDP remaining at 5.8 percent, despite a slowdown in the Indian economy. GDP growth in India slowed marginally because of lower-than-expected growth in agriculture sector output and slower growth in the industry sector. Bangladesh performed well in 2000, recovering from the devastating floods of 1999. The other South Asian economies showed strong signs of recovery in 2000, mainly because of higher growth in agriculture sector output. Exports in India recorded a double-digit rate of growth in 2000, spurred by the recovery in global trade and depreciation of the rupee. The growth of exports in other South Asian countries was also high.

All of the South Asian countries recorded large fiscal deficits in 2000 despite efforts to stabilize their annual budgetary shortfalls and restructure their overall revenue collection and expenditure management programs. Persistent fiscal imbalances resulted in the high cost of capital, crowded out financial resources for the private sector, and discouraged private sector investment. High population growth, insufficient GDP growth, low human resource development, and improper social assistance have constrained efforts to reduce poverty in the subregion, home to more than half of Asia’s poor. Sustained vigorous reforms to address macroeconomic and social sector impediments are critical for the subregion to improve the welfare of its people and to accelerate socioeconomic progress.

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