Overview

South Asia is one of the fastest growing regions in the world. But millions still live in extreme poverty. It is estimated that more than a quarter of South Asia’s 1.4 billion people cannot even attain their basic needs as defined in the context of the country they live in. The region is home to more than 375 million of the world’s poor, which represents the largest concentration of poverty among all regions of the developing world. 

Over the last decade, countries have witnessed accelerated growth that has substantially reduced the proportion of people living below the poverty line.  At the same time, the decade has also witnessed a rise in inequality in most countries in the region, which has likely dampened the poverty-reducing impact of growth.  This is a consequence of uneven growth among different regions within countries, and has resulted in sizeable sections of the population being excluded from the benefits of growth.   

For example:

• In a small country like Sri Lanka, the benefits of growth have largely eluded the most of the population that live outside the growth center that is the capital city of Colombo and its neighboring areas.
• For a vast country like India, uneven growth has widened disparities between fast-growing states in the South and West and lagging states in the North. 
• Within countries, rising inequality is also manifested in exclusion of socially disadvantaged groups from economic development, such as the Scheduled Castes and Tribes in India, the rural landless in Pakistan and Nepal or the plantation workers in Sri Lanka.  

Greater efforts therefore need to be mobilized across the region to sustain the growth momentum, and make the growth process more equitable and inclusive.

To facilitate broader participation in growth, efforts must be made to build human capability, particularly among future generations and women.  Despite improvements in education and health services: 

• Nearly half of the children under 5 years remain malnourished
• Universal primary education has not been achieved for most countries (the region exhibits the world's highest illiteracy rate among youth of age 15-24)
• Disparities between men and women in human development are pervasive. 

These illustrate the significant challenges that face the region in order to realize the Millennium Development Goals  of halving poverty and attaining substantial improvements in other aspects of social development by 2015.

Since poverty in the South Asian context is related to a multitude of factors, addressing these constraints requires a comprehensive and multi-sectoral approach.  Given the magnitude of the problem, it also requires a coordinated effort among the different partners in the development process, including the governments and donors like the World Bank.  In South Asia , such a partnership has been built around the Poverty Reduction Strategy Papers (PRSP ) process currently ongoing in most countries in the region.  The PRSPs – national poverty reduction strategies that are prepared and owned by the countries themselves – provide a framework to ensure that the support from donors like the World Bank fit into the country’s overall vision and strategy for development. 

World Bank Assistance for Poverty Reduction

The World Bank has been working with country governments to strengthen their monitoring and statistical systems to better monitor development progress and poverty reduction.

The Bank has also been conducting analytical work (AAA), which provide the governments with policy recommendations for reducing poverty, as well providing technical assistance to help them implement poverty alleviation programs and strategies.