South Asia Development Matters – serie

Inequality in South Asia examines the trends in multiple dimensions of inequality, analyses the drivers of inequality, and identifies policies for shared prosperity in South Asia. Part one of the book covers not only inequality of consumption, but also inequality of services and draws upon the most recent household surveys in each country to capture the trends. The South Asian experience is also compared to that of other countries. Part two focuses on the drivers of inequality, the lack of opportunity, insufficient mobility of the poor and the vulnerability of the poor to shocks which are keeping the high rates of growth being generated recently in South Asia from having a larger impact on inequality. Part three addresses policies that could lead to a more equitable path of growth.The book highlights that because of the limited progressivity of tax systems in South Asia to address inequality, most of the public policy impact on inequality will be generated through the effect that expenditure policies have on opportunities and jobs. To ensure that growth generates more equity in the future, investment is needed in both resources to increase opportunities for more and better jobs, and management to address the variation in the quality of implementation in providing services to the poor. At the same time, social protection is needed to ensure that the health, economic, and natural disaster shocks that are so prevalent in South Asia do not make it impossible for the poor to accumulate assets and share in future prosperity.

South Asia is highly vulnerable to climate change. Given that many of the poor live in areas prone to climactic shifts and in occupations that are highly climate-sensitive, such as agriculture and fisheries, future climate change could have significant implications for living standards. At the same time, the effect of climate change will vary significantly depending on the level of exposure and the inherent adaptive capacities of individuals, households, and communities. It is therefore important to understand how climate varies spatially and over time at a relatively granular level and to better understand the corresponding spatial effects of climate change on living standards. This report will aid in the development of targeted policies to improve resilience of the people, especially the poor and vulnerable, to future climatic shifts. Using historic and projected climate and household survey data, this study investigates the historic spatial patterns of climate change across South Asia at the district level, the effect of changes in long-term average climate on living standards at the household level, and where the future hotspots may be. The analysis complements studies that have investigated effects of extreme climate events and finds that projected future temperature and precipitation changes could create a significant challenge for certain geographic areas and populations, which could reduce gains in increases to living standards that have taken place over the past decades.

This flagship report for South Asia will try to map the financial risks from contingent liabilities in South Asian countries and provide policy recommendation to improve management of financial risks at the level of the sovereign, state-owned enterprises.

Governments can boost climate resilience by expanding access to information, promoting insurance, and investing in infrastructure. In South Asia, these actions are key to protecting people. Given limited public resources, the private sector will be key to driving solutions. The book lays out a policy roadmap to help unlock impact.