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

How we are helping

2016-17 Total Australian ODA Estimated Outcome
$26.6 million

2017-18 Regional Budget Estimate
$19.8 million

2017-18 Total Australian ODA Estimate
$25.4 million

South Asia has the highest concentration of poor people in the world with more than 400 million people still 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.

The Australian Government will provide an estimated $25.4 million in total ODA to the South Asia Regional program in 2017-18.

South Asia is among the least integrated regions in the world. Australia has a growing trading and economic partnership with South Asia. In 2015, Australia's two-way goods and services trade with South Asia was worth at least AUD22 billion. Improved regional connectivity across South Asia would promote economic growth and regional stability, and a more integrated region would increase access to South Asia markets, opening opportunities, including for the provision of Australian goods and services.

While the region had an impressive growth rate of 7.1 per cent per annum over the last decade, intra-regional trade in South Asia accounted for just 5 per cent of total trade in 2016 (versus 47 per cent across developing Asia as a whole). 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 – such as over-administration at borders – 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, such as water. In the last twenty years, over 50 per cent of South Asians (more than 800 million) have been affected by at least one natural disaster. 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 these shared resources to ensure their long term sustainability and capacity to support economic growth and to maintain regional stability.

The South Asia Regional program seeks to underpin Australia's economic engagement in the region by addressing these key region-wide barriers to sustainable economic growth. Improved regional connectivity is likely to be of great value to women, many of whom are engaged in informal trade, through higher incomes as producers and as consumers of lower priced and better quality traded goods. Gender equality will be a focus in all our investments under the regional program.

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

The objective will be addressed 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

  • Delivering access to solar-powered appliances and lighting for up to one million vulnerable households.
  • Training for 15,000 farmers (30 per cent of them women) in sustainable farming techniques, resulting in productivity and income gains.
  • Increased capacity of water professionals to implement integrated water resource management in Pakistan, underpinned by Australian water modelling approaches.
  • The uptake of basin-wide modelling approaches in the Indus, Koshi and India's Brahmani Baitarani basin.

Regional connectivity

  • Development of a strategy to strengthen infrastructure planning and management in the trade hub of Chittagong, including for climate resilience.
  • Development of Gender Action Plans to improve public transport conditions for women in three Indian cities.
  • Development of an impact evaluation of the Government of India's Pradhan Mantri Gram Sadak Yojana (PMGSY) program which aims to provide all-weather road access to rural communities, informing the future design of rural connectivity projects in India and other developing countries.
  • Assessment of the South Asia region's port-related trade-transport competitiveness. The results and recommendations have been provided to the Government of India to improve port sector efficiency, including efficient port logistic services.

Last Updated: 22 September 2017