South Asia's Development Journey: How IDA is Transforming Lives

For over six decades, the World Bank’s International Development Association (IDA) has been a lifeline for low-income countries, providing them with affordable development funding when few other options exist. IDA has helped improve millions of lives and supported development results that have moved countries forward.

In this past year, the World Bank has embarked on a journey towards becoming a better Bank—implementing core reforms and stepping up its ambition to address the intertwined development challenges the world faces and achieve stronger development outcomes at scale. The new World Bank Group Scorecard identifies key outcome areas and offers indicators to measure progress and impact against ambitious targets. 

IDA plays a vital role in driving development outcomes, with South Asia exemplifying its impact. Over the last two decades, IDA countries in South Asia have made impressive progress across development sectors. 

By several key measures, South Asia has accounted for two-thirds or more of the progress achieved by countries that were eligible for IDA loans two decades ago, in 2004. 

• Poverty: In 2004, over a billion people in IDA countries lived in extreme poverty, with South Asia accounting for half of them. By 2023, these numbers had fallen to 652 million in IDA countries, with 165 million residing in South Asia. India¹ alone accounted for four-fifths of this reduction, in part because of its sheer size and a dramatic decline in poverty rates - from 41 percent in 2004 to 10 percent in 2023. Similarly, extreme poverty rates in the rest of South Asia dropped significantly, from 25 percent in 2004 to just 4 percent in 2023. 

• Sanitation: In 2004, 28 percent of people in South Asia had access to basic sanitation, compared to the 36 percent in other IDA-2004 countries. By 2023, the share of people in South Asia with such access increased to 75 percent, surpassing the 49 percent achieved by other IDA countries. As a result, South Asia contributed to three-quarters of the sanitation improvements made by all IDA-2004 countries since 2004. 

• Internet and electricity: Internet access in South Asia reached 42 percent of the population in 2024, up from 2 percent in 2004. Similarly, access to electricity in South Asia increased from 63 percent in 2004 to 99 percent according to the latest data. South Asia accounted for two-thirds of IDA-2004 countries’ total improvements in access to electricity. 

• Health: Early childhood stunting in South Asia saw a marked reduction over the past two decades, decreasing from 48 percent to 31 percent, aligning with the levels of all other IDA-2004 countries. Maternal mortality rates in South Asia more than halved, from 33 per 10,000 live births in 2004 to 14 in 2020. Overall, South Asia accounted for over three-quarters of the decrease in early childhood malnutrition and over two-thirds of the reduction in maternal mortality rates observed in IDA-2004 countries over the past two decades.

• Education: In education, South Asia’s improvements kept pace with those in the other IDA-2004 countries, particularly in primary school completion. Between 2004 and 2021, the percentage of students completing primary school in South Asia (including India) increased by 12.4 percentage points, reaching 88.3 percent. Similarly, in other IDA-2004 countries, completion rates increased from 72.2 percent in 2004 to 84.9 percent in 2021. 

In many ways, South Asia may constitute a model for overcoming the development challenges that persist in many other developing countries. 

But the region remains vulnerable to setbacks. Several countries continue to grapple with economic instability and fragility, conflict, and violence. The region is one of the most vulnerable to climate risks, with the largest number of people affected by natural disasters over the past decade. Additionally, job creation has not kept pace with the rapidly growing working-age population, especially for women, highlighting a critical gap in inclusive economic growth.

Addressing these challenges in South Asia and beyond will require strong, collective commitment and action from all stakeholders. In December, the IDA21 replenishment cycle will conclude with donors gathering in Seoul, Korea, to reaffirm their commitments to IDA. A strong replenishment of IDA21 will be essential to sustain progress towards meeting development goals for the countries that need it most.  

Progress towards key development goals, 2004-23

^{Sources: WDI (database); WEO (database); World Bank Poverty and Inequality Platform; World Bank.}

^{Note: IDA = IDA-eligible countries in 2004 (including all SAR countries); IDA-2004 graduates = countries eligible to IDA financing in 2004 that have graduated since, excluding India, which is split out separately; SAR = South Asia.}

^{A. Sample includes 75 countries that are currently eligible for IDA financing and 11 countries that were eligible to IDA financing in 2004 but have graduated since. India is among the graduating countries but is shown separately in this chart. Rest of the world includes 81 countries.}

^{B. Aggregation uses weighted average. IDA refers to countries eligible to IDA financing in 2004. Bars show the contribution to the improvement in each indicator over the period 2004-2022. Sample includes up to 89 EMDE countries of which up to 8 are in SAR. Missing values are filled using linear interpolation.}

¹ India graduated from IDA in 2014.