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Development assistance in South and West Asia

Overview of Australia’s South and West Asia Regional aid program

Overview of Australia's South and West Asia Regional aid program

How we are helping

2018-19 Total Australian ODA Estimated Outcome
$24.3 million

2019-20 Bilateral Budget Estimate
$14.8 million

2019-20 Total Australian ODA Estimate
$23.4 million

South Asia is a region of contrasts. It is home to more than 300 million people living in extreme poverty. Many more people, particularly women and those working in the informal sector, live just above the poverty line and remain vulnerable to economic and environmental shocks.

South Asia also has one of the fastest economic growth rates region in the world (estimated at 6.5 per cent1 in 2018) and in 2016-17, India was Australia's fifth largest export market. At the same time, intra-regional trade sits at less than five per cent, compared to 30 per cent for Association of Southeast Asian Nations (ASEAN). The relatively poor quality of trade-related infrastructure (e.g. ports, roads and storage facilities), as well as of energy production and distribution networks, are key constraints to growth. Non-tariff barriers and border controls add to the high cost of cross border trading (50 per cent higher than ASEAN).

Across South Asia there is limited cooperation on shared regional resources including water. Climate variability, competing and increasing demands from agriculture, industry (including energy production) and population growth will all impact on water availability. Greater levels of cooperation will be needed to manage shared resources to ensure their long term sustainability and capacity to support economic growth and to maintain regional stability.

The Australian Government will provide an estimated $23.4 million in official development assistance through the South Asia Regional program in 2019-20.

The South Asia Regional program seeks to promote stability, economic growth and regional cooperation by addressing region-wide barriers to sustainable economic growth. The program takes a long-term approach with two inter-related objectives, which focus on: (i) water, agriculture, food and energy; and (ii) infrastructure and trade facilitation. Through these two objectives the program supports technical assistance, analysis and research, advocacy and policy reform. Promoting gender equality is a key cross-cutting focus.

Australia will also strengthen and build the capacity of regional institutions like the Indian Ocean Rim Association and promote greater cooperation on shared resources in the Indian Ocean.

The South Asia Regional program focuses on two inter-related objectives as outlined in the Aid Investment Plan:

Objective 1: Increased water, food and energy security in South Asia to facilitate economic growth and improve the livelihoods of the poor and vulnerable (particularly women and girls)

The Sustainable Development Investment Portfolio (SDIP) seeks to respond to major regional development challenges in South Asia - improving transboundary water resource management, increasing access to energy and energy connectivity, and increasing agricultural productivity and farm incomes. SDIP targets these three inter-related sectors where Australia is uniquely placed to contribute its expertise and technologies.

South Asia Regional Development Program: increased water, food and energy security

Objective 2: Increased regional connectivity through trade facilitation and infrastructure connectivity

Australia is promoting increased regional connectivity in South Asia through the World Bank-implemented Infrastructure for Growth (IFG) and the South Asia Regional Trade Facilitation Programs (SARTFP). IFG aims to meet infrastructure gaps in the region by addressing the major challenge of connectivity and integration, both within countries and the region. SARTFP seeks to improve border trade and connectivity in the eastern sub region (which includes the North Eastern states of India, Bangladesh, Bhutan and Nepal) with a particular emphasis on enabling women's participation in trade and economic activity.

South Asia Regional Development Program: regional connectivity

We will also continue to meet commitments to the Indian Ocean Rim Association and the Australia-India Strategic Research Fund.

Our results

Recent results include:

Sustainable development

  • Working with governments and private sector agencies to implement more effective practices for river basin modelling, improved knowledge of water resources and providing high-level knowledge exchange and mentoring.
  • Increasing the capacity of government and the private sector to reduce greenhouse gas emissions and build system resilience through increased renewable energy production and energy efficiency in the textiles industry in Bangladesh involving more than 200 textile manufacturers.
  • Improving sustainable agriculture by piloting more resilient farming practices with 52,386 farmers (of which 15,300 are women) in the Eastern Gangetic Plains.

Regional connectivity

  • Providing inputs to the World Bank Mumbai Urban Transport Project including gender support to mainstream measures that improve safety and security, as well as reduce the risk of violence against women and girls on transport in Mumbai, with the objective of increasing their use of public transport to access education, markets, and job opportunities.
  • Support for building capacity and strengthen institutions in state power utilities in six states in the North Eastern Region of India resulted in increased availability of reliable power in Manipur State. This in turn is facilitating the mechanization of farming and storage and processing of agricultural produce while increasing employment.
  • A diagnostic study of power sector in six North Eastern states of India supported the first phase of the USD470 million IBRD lending project to address the gaps it identified in procurement and implementation.
  • Support for the Buddhist Circuit Development is enabling South Asian countries to develop tourism in an inclusive manner to benefits local communities. For example the state of Uttar Pradesh (home of the Taj Mahal) has re-oriented its Tourism Policy to focus on poverty alleviation by preparing a Pro-Poor Tourism Development Project for its USD 57 million loan from the World Bank.
  • A study on integrating intermodal transport (rail, roads, inland water) in India improved the ability to move freight seamlessly and cost effectively to domestic and export markets. As a result, infrastructure projects in India including government projects have improved their consideration of interconnectedness in their investments.

1 The World Bank, 2018. The World Bank in South Asia, 2018.

Last Updated: 2 April 2019
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