Economic Factors Affecting South Asian Development

The intertwined fates of India, Pakistan, and Bangladesh in their pursuit of economic sustainability have been subject to intricate challenges and opportunities. Poor governance and institutional weaknesses are widely recognized as key barriers to socio-economic progress in South Asian nations. This impediment requires a deeper understanding of economic factors affecting their growth trajectories.

Poor Governance and Institutional Weakness

Ishrat Husain, ex-governor of Pakistan’s State Bank, underscores that these nations struggle due to weak governance and fragile institutions. Husain’s remarks, made during the launch of “Development Pathways – India, Pakistan, and Bangladesh, 1947-2022,” shed light on the reluctance of civil services to serve the people due to a self-perceived superior status. This prevailing attitude inhibits addressing the problem and implementing effective economic policy measures for sustainable growth.

Furthermore, Husain highlighted a decline in Pakistan’s institutional confidence since 1990 despite historically strong institutionalisation that laid the groundwork for infrastructure development. Institutional setbacks have hindered crucial short-run growth elements like planning commissions and development corporations, causing them to falter.

Rising Inequality and De-democratization

Another concerning aspect of the economic problem in these South Asian nations is the growing inequality in income and politics. Professor Rehman Sobhan emphasised the surge in political inequality and its adverse impact on democratisation in these nations. Income and political inequality worsen the problem by limiting participation and leadership opportunities in the political sphere. As the terms and conditions for participating in politics become more unequal, achieving true development becomes increasingly challenging.

In conclusion, the economic factors affecting India, Pakistan, and Bangladesh significantly affect their ability to achieve economic sustainability and short-run economic growth. Inadequate governance and weak institutions impede economic policy implementation, and rising political inequality erodes democracy, exacerbating problems. These nations must address these issues by reforming their bureaucracies, enhancing institutional confidence, and promoting greater political inclusivity. Through such efforts, they can only work towards sustainability and long-term prosperity for their citizens.