South Asia’s Turn: Policies to Boost Competitiveness and Create the Next Export Powerhouse

South Asia has tremendous potential to increase incomes and gain market share in exports through policies that enhance productivity and investment. If the region harnesses its productivity potential, it could be the fastest growing exporting region, for instance, tripling its share in global exports of electronics and motor vehicles by 2030.

Overall, however, South Asian countries have underperformed in terms of both the quantity and quality of their exports. Fundamentally, this is because most firms in South Asia have low productivity which is the main driver of sustained competitiveness. The report highlights four main policy levers to boost the productivity and thus the competitiveness of firms:

• improve the business environment, 
• connect firms to global value chains, 
• leverage agglomeration benefits, and 
• strengthen the capabilities of managers and workers.