ZCZC
BCN-22
ADB-SOUTH ASIA-GROWTH
Shortages of quality infrastructure threaten South Asia’s growth momentum:
ADB
MANILA, Oct. 3, 2018 (BSS/Xinhua) – Shortages of quality infrastructure
threatened the South Asia’s progress, said a new working paper released by
the Asian Development Bank (ADB) on Tuesday.
The paper on Infrastructure Financing in South Asia said that to sustain
growth and deal with the threat of climate change, South Asia needs to invest
almost 9 percent of its gross domestic product (GDP) on infrastructure up to
2030, with India alone requiring 260 billion U.S. dollars.
“Unless it takes urgent steps, South Asia’s existing infrastructure could
soon prove to be a roadblock in sustaining its growth momentum and addressing
poverty and inequality,” said the paper, authored jointly by ADB Principal
Economist Shikha Jha and Rosa Mia Arao, a former research associate.
Indeed, the paper said that infrastructure in South Asia lags most other
regions such as East Asia, Latin America, and the Caribbean.
The paper pointed out that there are large deficits in transport and
connectivity, poor logistical performance at borders and ports, and a
consistent deterioration over the last decade in quality of roads due to lack
of maintenance.
On access to electricity, some of South Asia’s countries lag those in
Southeast Asia and East Asia. For example, the paper said only about 60
percent of the population in Bangladesh and 80 percent in India have access
to electricity, compared to almost the whole population in countries such as
China, Thailand, and Vietnam.
The quality of services such as safe drinking water and sanitation also
remains low in South Asia, according to the paper.
In 2015, the paper said only 56 percent of South Asian residents used a
safely managed drinking water service, in comparison with 71 percent of the
global population.
In order to provide adequate high-quality infrastructure, the paper said
South Asia countries need to mobilize more private finance, while making more
efficient use of budget spending to raise public expenditure.
According to the paper, ADB urged South Asia countries to improve the
business environment and create a private sector-friendly society.
“A stable and predictable environment is vital in providing confidence to
domestic and foreign investors,” the report said.
In general, as countries move to higher income levels, the report
concluded that meeting the infrastructure challenge will require the
development of capital markets, insurance companies, and pension funds, which
could share the infrastructure risk.
BSS/XINHUA/HR/1225