Transport and the Millennium Development Goals (MDGs)

The Millennium Development Goals (MDGs) aim to halve the proportion of people living in poverty-- on less than $1 a day -- by 2015, and set out other targets in education, gender equity, health, and the environment. The South Asia region (SAR) is extremely important in the battle against global poverty as it is home to over forty percent of the world’s poor and has over 400 million people living on less than $1 a day. It can, therefore, be said that the battle against global poverty will be won or lost in South Asia.

Transport is a means to an end, rather than the end itself. Good transport infrastructure and services, although not the only factor, are important in helping countries to meet the MDGs by reducing poverty, increasing access to education and health services, and improving the environment. There are three main links between the transport sector and the achievement of the MDGs:

Poverty reduction and transport. Evidence clearly shows that improving rural communities’ access to transport reduces poverty. In Nepal, an estimated 42 percent of people live below the poverty line, but in areas where roads are not adequate, the number soars to 70 percent. In developing countries, about 900 million rural people live in isolation without access to reliable all-season roads. In India, for example, many of the poorest villages are located some 15 to 20 km from the nearest roads. The resulting isolation is akin to imprisonment. Those who are held captive inside these villages are effectively marginalized as they cannot reach services such as schools, hospitals, markets and the like, or participate in the political life of their communities and country. Clearly, therefore, building transport links helps to integrate people into their wider communities, improves the quality of rural life, and helps to achieve the MDGs in poverty reduction, education, and health.

Economic growth and transport. Poverty reduction must be based on economic growth if it is to be sustainable. This requires better accessibility, greater mobility, and more efficient means of trade. China, the world’s most populous country, has reduced poverty more rapidly in the last 2 decades than many other countries. Between 1990 and 2000, the number of people living below $1 a day in China fell from 360 million to 200 million. While many factors contributed to this decline in poverty, it was largely the result of continuous economic growth of approximately 8-10 percent per annum for 20 years.

Since 1990, the South Asia region has also experienced relatively rapid GDP growth, averaging 5.5 percent a year. During this period, India has reduced its poverty rate by 5-10 percent. Most other countries have also registered a reduction in poverty during this time, with the exception of Pakistan where poverty has stagnated at around 33 percent.

While the South Asia region is on track in its efforts to reduce poverty, reaching the poverty reduction target of the MDG by 2015 will critically depend on its sustaining the recent growth trend over the next decade.

The development of modern transportation systems has been identified as a key factor in supporting the current economic boom in China as well as in many other countries such as the U.S, Korea, etc. during their rapid development stage. In contrast, it is widely accepted that SAR’s economic growth in the 1990s has been constrained among other factors by its poor infrastructure, especially its transport logistics systems.

Governance/public administration and transport. The transport sector provides many opportunities to improve public administration and governance. From major infrastructure projects such as highways, to local initiatives for providing rural access and public transport services, transport is among the most active and expensive areas of government operations.

Given the large amount of public resources involved, investment in the transport sector is also vulnerable to corruption. Developing, funding and maintaining expensive transport systems are among the most difficult challenges facing public institutions in both the developed and the developing world.

Roads, for instance, are big business. If the value of road assets typically managed by public road agencies were taken into account, these public agencies would be as big as the Fortune 500 companies. In both developing and developed countries, it is the road users who directly or indirectly pay for road development, either through tolls, user fees, or fuel taxes, etc. Therefore, improving public administration of road transport is central in providing best value to road users. This will require public road agencies to behave differently from their past practice, improve their governance systems, and manage roads on a commercial basis, much like any other business.

Consequently, transport as a sector has a great deal to contribute in improving governance, public administration, and the management of government finances, which ultimately trickles down to improve the lives of individuals. Given the general perception of weak governance in SAR, this also underscores the challenges facing public administration in improving the efficiency of public spending on transport.