The Hindu : Business : Concern over income inequality in South Asia

Online edition of India's National Newspaper
Wednesday, Dec 22, 2004

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Concern over income inequality in South Asia

By Our Staff Correspondent

NEW DELHI, DEC. 21. The Gross Domestic Product (GDP) growth of South Asia has been higher than the average of developing countries and the poverty has declined both in terms of depth and severity, though the decline has been modest. Persisting disparity and rising inequalities have fuelled social conflicts, according to the report of the Independent South Asian Commission on Poverty Alleviation.

The report "Our Future, Our Responsibility'' prepared by the South Asian Association for Regional Cooperation (SAARC) countries to conduct an in-depth study of poverty alleviation experiences says that though the Human Development Index (HDI) has improved at a rate higher than the average for developing countries but the level remains low.

In terms of national poverty incidence, the poverty rate showed decline to a varying degree in Bangladesh, India, Nepal and Sri Lanka and an increase in Pakistan over the 1990s.

However, income inequality is a rising concern for much of the region -- the ratio of income share of the richest 20 per cent to that of poorest 20 per cent has varied from 4 to Bangladesh to 5 in India.

According to the report, South Asia has shown better progress in under-5 mortality rate, from 148 to 94 deaths per 1,000 births in 2000, indicating a drop of 54 deaths per 1,000 births in a span of 10 years. There are, however, large variations across the region, from a low of 19 deaths per 1,000 births in Sri Lanka to 110 deaths per 1,000 births in Pakistan. "The rate of progress has been much faster for Bangladesh and Nepal compared to India and Pakistan. The report, released by the Deputy Chairman of the Planning Commission Montek Singh Ahluwalia, says that the challenge for the South Asian countries lies in finding the right balance between growth and welfare objective, embracing the opportunities of the global market while resisting the inequities and asymmetries of the globalisation process.

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