Overview of Australia’s aid program to South Asia

How we are helping

2013/14 Actual:
$8.4 million

2014/15 Budget Estimate:
$33.1 million

Australia’s development assistance to South Asia promotes economic growth, human development and stability in a region that is of growing strategic significance for Australia. The regional program targets cross-border development challenges that cannot solely be addressed at the country level, and complements Australia’s seven bilateral country programs in the region.

South Asia is home to the world’s largest number of people living below the poverty line, with over 500 million people living on less than US$1.25 per day. Development gains continue to be offset by high population growth, weak governance, conflict and natural disasters. It is one of the least integrated regions in the world and faces long term challenges associated with food, water and energy security. It also has the second highest trade costs. Intra-regional trade stands at 5 per cent of total trade compared with 50 per cent for East Asia and 30 per cent for Southeast Asia and non-tariff barriers are a primary cause. Gender inequality is widespread, holding back the region from achieving its full productive potential.

Australia’s regional aid investments in South Asia aim to reduce poverty and promote sustainable and inclusive growth by improving regional cooperation and connectivity. The regional program focuses on two key trans-boundary development challenges in South Asia:

  • Sustainable development, with a specific focus on improving water, food and energy security
  • Regional connectivity with a focus on trade facilitation and infrastructure connectivity.

Australia’s development assistance is delivered mainly through partnerships with multilateral agencies, civil society, and other Australian Government agencies.

Sustainable development

Australia’s investment in sustainable development in South Asia aims to support improved water resource management, better agricultural practices to generate higher farm productivity and incomes, and increased access to energy. Our investments target female-headed households, agricultural productivity, improving access to modern energy sources, and leverage Australia’s expertise in water resource management.

Sustainable development in the South Asia region

Regional connectivity

Australia’s regional aid investments aim to increase the potential for economic growth and reduce poverty by addressing low levels of intra-regional trade and poor infrastructure connectivity. Our investments are helping to promote economic opportunities for women, strengthen key institutions, and to close the infrastructure gap by supporting analytical work and technical assistance to facilitate policy and institutional reform in sectors including transport and energy.

Regional connectivity in South Asia

Our results

Sustainable development

Results to 30 June 2014

  • Completing a comprehensive study on landscape, hydrology, precipitation, geology and local economy in Zhangmou, the border trade post connecting China and Nepal, and preparing a landslide risk reduction plan in close consultation with local authorities.
  • Working with communities in the middle hills of Nepal to identify 15 groundwater recharge sites and supporting the construction or rehabilitation of ponds to improve the reliability of water supply to villages.
  • Completing 154 on-farm agricultural participatory research trials in West Bengal and Bangladesh, with preliminary results indicating up to 17 per cent better productivity for wheat and up to 11 per cent improved yields for maize.

Regional connectivity

Results to 30 June 2014

  • Strengthening South Asia Subregional Economic Cooperation countries’ capacities for trade facilitation through regional workshops on customs and logistics issues and trade processes/ reforms.
  • Utility assessments conducted in six Indian states to identify key challenges to institutional reform and capacity building needs to improve energy transmission.
  • Inception workshops held in Delhi, Dhaka, Islamabad and Kathmandu, to inform a regional study on energy security and trade—the study will highlight key domestic policy challenges to be addressed to meet growing regional demand for energy, and propose approaches to regionalisation for further analysis.