South Asia Subregional Economic Cooperation Program: 12 Things to Know | Asian Development Bank

South Asia Subregional Economic Cooperation Program: 12 Things to Know

Article | 19 December 2017

Rapid economic growth and a young population set the stage for deeper regional cooperation and integration in South Asia.

  1. South Asia is one of the fastest growing subregions in the world, with a large population of which 1.45 billion people will be of working age over the next 20 years.
    Source: South Asia Subregional Economic Cooperation Operational Plan 2016–2025
  2. South Asia has low levels of economic integration and intraregional trade, and poverty remains a significant challenge with about 294 million people, or over 20% of the subregion’s population, living on less than $1.90 a day as of 2012.
    Source: South Asia Subregional Economic Cooperation Operational Plan 2016–2025
  3. The South Asia Subregional Economic Cooperation, or SASEC, Program was established in 2001 to promote activities to accelerate economic growth and prosperity. Four initial members—Bangladesh, Bhutan, India, and Nepal—were later joined by the Maldives and Sri Lanka in 2014, and by Myanmar in 2017.
    Source: South Asia Subregional Economic Cooperation (SASEC)
  4. SASEC is a project-based partnership. The program has invested more than $9 billion into development activities in transport, trade facilitation, energy, economic corridors, and information and communications technology.
    Source: South Asia Subregional Economic Cooperation (SASEC)
  5. The Asian Development Bank supports SASEC as secretariat, advisor, and lead financial provider, with nearly $6 billion in loans and grants and more than $65 million in technical assistance.
    Source: South Asia Subregional Economic Cooperation Operational Plan 2016–2025
  6. After focusing on projects in the transport, trade facilitation, and energy sectors for the first 15 years, SASEC member countries, adopted a new operational plan for 2016 to 2025, which added economic corridor development to its list of activities.
    Source: South Asia Subregional Economic Cooperation Operational Plan 2016–2025
  7. Finance ministers of SASEC member countries launched a new vision for the program in April 2017 in New Delhi, India. The vision provides a roadmap for helping member countries unlock the full potential of their natural resources, industries, and infrastructure. It includes suggestions for resource-to-industry links, industry-to-industry links, and industry-to-infrastructure links, which collectively will generate economic synergies benefiting the whole subregion.
    Source: South Asia Subregional Economic Cooperation Vision: Powering Asia in the 21st Century
  8. Areas suggested for collaboration include a pipeline corridor between Bangladesh and India for crude oil import and product supply; an LPG transshipment and storage hub in Sri Lanka; passenger car assembly in Bangladesh; internal connectivity for enhanced tourism and trade in the Maldives; development of SASEC as a tourist destination; and cross-border power trade between countries of the subregion.
    Source: South Asia Subregional Economic Cooperation Vision: Powering Asia in the 21st Century
  9. Developing manufacturing value chains across multiple sectors would boost manufacturing output by around $44 billion by 2025 and increase its share of the subregional economy to about 21% from 14% in 2015.
    Source: South Asia Subregional Economic Cooperation Vision: Powering Asia in the 21st Century
  10. Establishing a car assembly industry in Bangladesh could deliver economic benefits of $4.6 billion and provide additional jobs for around 7 million people over the next decade. India stands to gain economic benefits of $3.4 billion and employment for about 4.9 million people from the supply of parts.
    Source: South Asia Subregional Economic Cooperation Vision: Powering Asia in the 21st Century
  11. Economic synergies from collaboration across all sectors could generate an estimated $70 billion a year in additional GDP for the subregion and provide employment for 20 million people by 2025.
    Source: South Asia Subregional Economic Cooperation Vision: Powering Asia in the 21st Century
  12. Sustained economic cooperation by SASEC member countries could lift about 14 million people out of poverty by 2025.
    Source: South Asia Subregional Economic Cooperation Vision: Powering Asia in the 21st Century