Its annual average economic growth of 7.6 percent between 2007 and 2017 far exceeds the average global growth rate of 3.2 percent.
This high growth has contributed to reducing poverty: Extreme poverty was mostly eradicated and dwindled from 8 percent in 2007 to 1.5 percent in 2017, based on the international poverty line of $1.90 a day (at purchasing power parity).
Access to basic services such as health, education and asset ownership has also improved significantly.
The country has a total of 32 hospitals and 208 basic health units, with each district hospital including almost always three doctors.
The current national literacy rate is 71 percent and the youth literacy rate is 93 percent.
The recent statistics on lending, inflation, exchange rates and international reserves (Sources: RMA, NSB) confirm that
Gross foreign reserves have been increasing since 2012 when the country experienced an Indian rupee shortage.
Reserves exceeded $1.1 billion, equivalent to 11 months of imports of goods and services, which makes the country more resilient to potential shocks.
The nominal exchange rate has been depreciating since early 2018 (with ngultrum reaching Nu. 73 against the US dollar in early November).
End Poverty Day fell on the 17th of October. Two weeks later, the new Doing Business rankings come out for this year.
If you’re wondering what the link is, here’s a quick summary:
This is one of those happy instances where economics, common sense and the data align.
Then the market responds- not only do these employers create more jobs, but also going to offer better jobs to attract capable workers to their companies.
Ultimately, a reliable source of income is the catalyst to moving out of poverty.
Sounds too simple? Trust the numbers.
Imagine a state-of-the-art processing plant that harnesses laser-sorting technology to produce a whopping 15,000 tons of raisins a year, linking up thousands of local farmers to international markets and providing job opportunities to women.
To find such a world-class facility, look no further than
In Afghanistan’s volatile business environment, let alone its deteriorating security, Rikweda’s story is an inspiration for budding entrepreneurs and investors.
It also is an illustration of the government’s reform efforts to create more opportunities for Afghan businesses to open and grow, which were reflected in the country’s record advancement in the Doing Business 2019 index, launched today by the World Bank.
And Afghanistan is not the only South Asian country this year that took a prominent place among top 10 improvers globally.
. Its ranking has improved by 23 places this year and puts India ahead of all other countries in South Asia. This year, India is ranked 77th, up from 100th last year.
It’s nearing sunset near the town of Hathras in India’s state of Uttar Pradesh, home to 220 million people—more than the entire population of Brazil.
Through these efforts, DFC is expected to improve transport and trade logistics – bringing much needed jobs, connectivity, and urbanization opportunities to some of India’s poorest provinces – including Bihar and Uttar Pradesh while helping protect the environment. The electric locomotives will help ease India’s energy security issues and escalating concerns about traffic accidents, congestion, carbon emissions, and pollution created by road traffic.
Near Hathras and simultaneously in different sites in the country, workers equipped with modern equipment and techniques efficiently lay 1.5 km of new track per day in different weather conditions.
In 2011, Bangladesh and India flagged off the first of their border haats, representing an attempt to recapture once thriving economic and cultural relationships that had been truncated by the creation of national borders.
Border Haats are local markets along the Indo-Bangladesh border that stretches 4100 Kms and runs through densely populated regions.
Conceived as Confidence Building Measures between India and Bangladesh, 4 Border Haats were set up between 2011 and 2015.
- Balat (Meghalaya) – Sunamgunj (Sylhet)
- Kalaichar (Meghalaya) – Kurigram (Rangpur)
- Srinagar (Tripura) – Chagalnaiya (Chittagong)
- Kamalasagar (Tripura) – Kasba (Chittagong)
Initially only local produce was permitted for trade. But subsequently, the range of items has been broadened to include goods of household consumption.
But border haats are not only about trade.
Home to Afghanistan, Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan, and Sri Lanka, South Asia is one of the world’s most dynamic regions.
It's also one of the least integrated.
A few numbers say it all: Intra-regional trade accounts for only 5 percent of South Asia’s total trade; Intra-regional investment is smaller than 1 percent of overall investment.
This blog is based on the report The Web of Transport Corridors in South Asia -- jointly produced with the Asian Development Bank, the United Kingdom’s Department for International Development, and the Japan International Cooperation Agency
One of the oldest, the Grand Trunk Road from the Mughal era still connects East and West and in the 17th century made Delhi, Kabul and Lahore wealthy cities with impressive civic buildings, monuments, and gardens.
In India alone—and likely bolstered by the successful completion of the Golden Quadrilateral (GQ) highway system—several transport proposals extending beyond India’s borders are now under consideration.
They include the International North-South Transport Corridor (INSTC), linking India, Iran and Russia, the Asia-Africa Growth Corridor, and the Bangladesh, China, India, and Myanmar (BCIM) economic corridor.
The hope is that these transport corridors will turn into growth engines and create large economic surpluses that can spread throughout the economy and society.
These two cities are the economic hubs of China and India respectively, two emerging global powers.
The distance between them, about 5,000 kilometers, is not much greater than the distance between New York and Los Angeles.
But instead of crossing a relatively empty continent, a corridor from Shanghai to Mumbai—via Kunming, Mandalay, Dhaka, and Kolkata—would go through some of the most densely populated and most dynamic areas in the world, stoking hopes of large economic spillovers along its alignment.
“Build and they will come” seems to be the logic underlying many massive transport investments around the world.
However, the reality is that not all these investments will generate the expected returns.
Worse, they can become wasteful white elephants—that is, transport infrastructure without much traffic—that would cost trillions of dollars at taxpayers’ expense.
First, countries need to change the mindset that transport corridors are mere engineering feats designed to move along vehicles and commodities.
Second, sound economic analysis of how corridors can help spur urbanization and create local jobs while minimizing the disruptions to the natural environment, is key to developing successful investment programs.
Specifically, it is vital to ensure that local populations whose lives are disrupted by new infrastructure can reap equally the benefits from better transport connectivity.
For instance, more educated and skilled people can migrate to obtain better jobs in growing urban areas that are benefiting from corridor connectivity, while unskilled workers may be left behind in depopulated rural areas with few economic prospects.
But while corridors can create both winners and losers, well-designed investment programs can alleviate potential adverse impacts and help local people share the benefits more widely.
In that vein, India’s Golden Quadrilateral, or GQ highway system, is a cautionary tale.
No doubt, this corridor had a positive impact.
Economic activity along the corridor increased and people, especially women, found better job opportunities beyond traditional farming.
But this success came at a cost as air pollution increased in the districts near the highway.
This is a major tradeoff and one that was documented before in Japan when levels of air pollution spiked during the development of its Pacific Ocean Belt several decades ago.
Another downside is that the economic benefits generated by the GQ highway were distributed unequally in neighboring communities.
The Innovation Paradox: Developing-Country Capabilities and the Unrealized Promise of Technological Catch-Up – sheds light on how to address this paradox.
What is the new study Innovation Paradox all about?
The potential gains from bringing existing technologies to developing countries are vast, much higher for poor countries than for rich countries. Yet developing-country firms and governments invest relatively little to realize this potential. That’s the origin of what we are calling ‘The Innovation Paradox’.
Why do firms in developing countries lag behind when it comes to innovation?
The Innovation Paradox, argues that developing country firms choose not to invest heavily in adopting technology, even if they are keen to do so, because they face a range of constraints that prevent them from benefitting from the transfer.
Developing country firms are often constrained by low managerial capability, find it difficult to import the necessary technology, to contract or hire trained workers and engineers, or draw on the new organizational techniques needed to maximize the potential of innovation. Moreover, they are often inhibited by a weak business climate. For example, small and medium enterprises (SMEs) are constantly in a situation where they are putting out fires, they don’t have a five-year plan, they don’t have somebody keeping track of what new technology has come out of some place that they could bring to the firm.
The rates of return to investments and innovation of various kinds appear to be extremely high, yet we see a much smaller effort in these areas. In the developing countries, we need to think not only about barriers to accumulating knowledge capital, we have to think about all the barriers to accumulating all of the complementary factors—the physical capital. So, if I have a lousy education system, it doesn’t matter if I get a high-tech firm because there won’t be any workers to staff it.
Innovation requires competitive and undistorted economies, adequate levels of human capital, functioning capital markets, a dynamic and capable business sector, reliable regulation and property rights. Richer countries tend to have more of these conditions. This is at the root of Paradox. Even though follower countries have much to gain from adopting existing technologies from the advanced countries, in practice, missing and distorted markets, weak management capabilities and human capital prevent them from taking advantage of these opportunities.
To facilitate Foreign Direct Investment (FDI), Sri Lanka launched last week an innovative online one-stop shop to help investors obtain all official approvals. To mark the occasion, this blog series explores different aspects of FDI in Sri Lanka. Part 1 put forth 5 Reasons Why Sri Lanka Needs FDI. Part 3 will relate how the World Bank is helping to improve Sri Lanka’s enabling environment for FDI.
But it was not always the case.
. Others including Marubeni, Sony, Sanyo, Bank of Tokyo and Chase Manhattan Bank, had investments in Sri Lanka in the pipeline in the early 1980s.
All this changed when the war convulsed the country and derailed its growth. Companies left and took their foreign direct investments (FDI) with them.
In 2017, Foreign Direct Investment (FDI) into Sri Lanka grew to over $1,710 billion including foreign loans received by companies registered with the BOI, more than doubling from the $801 million achieved the previous year.
You may have heard that . At the same time, the government aims to improve the lives of Sri Lanka’s citizens by generating one million new and better jobs.
This isn’t a pipe dream. T , and high-value-added food processing and apparel.
What is foreign direct investment and why does Sri Lanka need it?
Very simply, foreign direct investment (or FDI) is an investment made by a company or an individual in a foreign country. Such investments can take the form of establishing a business in Sri Lanka, building a new facility, reinvesting profits earned from Sri Lanka operations or intra-company loans to subsidiaries in Sri Lanka.
The hope is that these investment inflows will bring good jobs and higher wages for Sri Lankan workers, increase productivity, and make the economy more competitive.
Attracting more FDI can help achieve that goal and fulfill the promise of better jobs.
Here are five reasons why: