Kathmandu: The Asian Development Bank (ADB) has launched an operational plan for the implementation of $121 billion worth of projects in South Asia.
The plan for South Asia Sub-regional Economic Cooperation (Sasec) contains comprehensive strategies to roll out 209 projects in Bangladesh, Bhutan, India, the Maldives, Nepal and Sri Lanka within 2025.
It is the first ever long-term plan for Sasec, according to Kenichi Yokoyama, Country Director of the ADB, Nepal.
“It has unified strategies under Sasec’s three priority areas — transport, trade facilitation and energy — under one framework and has added the spatial dimension of economic corridor development [in the region],” Yokoyama said.
The operational plan aims to align land- and sea-based routes to support efficient distribution and collection of goods, and ensure seamless movement of people in the region.
In this regard, roads will be upgraded or expanded, rail lines for routes that ferry high-volume cargoes will be increased, deep sea ports that can handle larger vessels will be developed, and congested international airports, including their storage spaces will be expanded.
Also, more inland container depots will be built, land customs stations will be upgraded, and port infrastructure will be developed or expanded to cope with anticipated growth in container traffic.
These efforts to enhance connectivity will enable countries to gain better access to markets, paving the way for nations to integrate into regional and global value chains.
This is ultimately expected to reduce trade costs and enhance competitiveness of different countries, raising the trade volume in the region.
Trade among South Asian countries currently hovers around 5 per cent of the total regional trade. In contrast, trade among Southeast Asian countries stands at around 25 per cent of their total trade. Yet, trade between South Asia and Southeast Asia has grown by whopping 22 times between 1990 and 2013.
“This indicates the potential for South Asia to tap into Southeast Asia’s burgeoning integrated market of 625 million people,” Yokoyama said.
In this regard, plans are afoot to link Sasec with Myanmar, which can emerge as a gateway for South Asian countries to enter the Southeast Asian market.
The ADB has approved 43 Sasec projects worth almost $9 billion in transport, energy, trade facilitation, and information and communications technology since Sasec was launched in 2001.