Economic liberalisation in South Asia performance and prospects

With the exception of Sri Lanka, South Asian countries are only in the initial phase of implementation of comprehensive reform programmes of economic liberalisation. There is argument in most countries as to precisely when the reform process began, but while this is of historical interest, the early attempts in these countries were piecemeal and had little impact, except perhaps in India in the 1980s when the average growth rate rose about 5 per cent. Most important, the decade of the 1990s represents a turning point for all countries in South Asia, marking a time when the political parties of all major countries committed themselves irrevocably to the path of economic liberalisation, and through the democratic process.

The disappointing performances of these economies under inward-looking and public sector dominated autarchic economic regimes in terms of growth and equity have been well documented. Much now depends on how these economies perform as they seek the benefits of global economic interdependence, and rely increasingly on foreign trade and investment, and on the increasing influence of the private sectors as the engine of growth.