According to the new report by the World Bank, Reducing Poverty by Closing South Asia’s Infrastructure Gap, South Asian countries will have to invest as much as $2.5 trillion on transport, electricity, water supply and sanitation, solid waste management, telecommunications, and irrigation to bridge its infrastructure gap.
Between 1990 and 2010, the number of people living on less than US$1.25 a day in South Asia decreased by only 18 percent, while the population grew by 42 percent. If South Asia hopes to meet its development goals and not risk slowing down, or even halting, growth and poverty alleviation, it is essential to make closing its huge infrastructure gap a priority.
The gap is defined as the difference between South Asia’s development goals and its actual capability to obtain those goals. According to the report, addressing it will require investing as much as $2.5 trillion over the next ten years: one third to be spent on transport, one third on electricity, and the remainder on water supply and sanitation, solid waste management, telecommunications, and irrigation.
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,” said Matias Herrera Dappe, co-author and World Bank Senior Economist for South Asia.
It further said governments could establish solid and transparent legal, policy and regulatory frameworks in order to attract private investment in line with the best organizational form for each service. They could also decentralize service provision in an appropriate manner.
According to the report, South Asian policy makers should invest in rehabilitating and maintaining infrastructure assets to deliver services efficiently and sustainably, moving away from the “build, neglect, and rebuild” mindset.
If South Asia hopes to meet its development goals and not risk slowing down growth and poverty alleviation, it is essential to make closing its huge infrastructure gap a priority.
The World Bank said it has a portfolio of 96 active infrastructure projects in the region, with total commitments of 19.8 billion U.S. dollars.