gE Blog Series: Global Infrastructure Development Part 4 - South Asia's Infrastructure Needs

Over the past decade South Asia has experienced rapid economic growth, but its infrastructure growth has not kept pace. The World Bank recently came out with a report, “Reducing Poverty by Closing South Asia’s Infrastructure Gap,” which found that countries in South Asia need to invest up to $2.5 trillion in order to bridge the infrastructure gap in the next ten years. An infrastructure gap is the difference between a country’s development goals and its actual capability to obtain those goals.

According to the report, one third of the $2.5 trillion has to be spent on transport, one third on electricity, and the remainder split between water supply and sanitation, solid waste management, telecommunications, and irrigation. South Asia is made up of Afghanistan, Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan, and Sri Lanka. Of these countries, Maldives’ population has the largest access to infrastructure services with 95% of its population having access to electricity and 98% of its population having access to improved sanitation. Afghanistan has the most limited access to infrastructure services amongst these countries with 30% of its population having access to electricity and 29% of its population having access to improved sanitation.

Recently there have been pushes for infrastructure development in many of these countries. For example, Tata group, an Indian conglomerate, is planning on investing $8 billion in building roads, airports, and housing in India. Bhutan has recently seen a large increase in mobile phones, despite being one of the last countries in the world to get television. Of Bhutan's 750,000 people, an astonishing 73% is connected to one of Bhutan’s two cellular networks. Despite these recent advances in infrastructure, South Asian countries still have a significant amount of investment needed in order to bridge the gap.

According to Matias Herra Dappe, a World Bank Senior Economist for South Asia, “Infrastructure deficiencies in South Asia are enormous, and a mix of investment in infrastructure stock and implementing supportive reforms will enable the region to close its infrastructure gap.”

As South Asian economies continue to rapidly grow, it will be important to bridge the infrastructure gap. In order to become competitive on a global level, these countries need to invest a tremendous amount of capital into infrastructure. Some projects are underway, but it is important for governments to explore methodologies for prioritizing infrastructure projects and getting them underway.