India Led Growth in South Asia: Empirical Analyses

Bhattarai, Keshab

Abstract

Strategic lessons are drown based on Ramsey model of growth for the South Asia region and empirical panel data analysis on the determinates of growth in it. Given its size of population this region should push for growth and increase its share of global GDP up to 20 percent from roughly 6.5 percent in 2014. Such growth requires increasing the ratio of saving and investment from about 10 percent above the current averages to around 35 percent. Process of structural transformation should continue till both the output and employment in the agriculture sector are less than 5 percent from around 17 and 50 percent at this moment. Such transformation will occur as this region moves towards urbanization so that about 90 percent of the population lives in urban areas. The student teacher ratios should be reduced from 40 to around 16 to raise the cognitive skill of children to create human capital in science and technology. The trade ratio be increased to around 100 percent from the 50 percent to enhance both the supply and demand sides of these economies. The liquidity of the financial system should at least treble from now to have a smooth flow of credits for new and existing enterprises. Free convertibility of currency may protect this region from international shocks. Fruits of growth should be distributed more equally so that the gini coefficients remain under 35 percent.

Citation

Bhattarai, K. (2021). India Led Growth in South Asia: Empirical Analyses. Journal of Development Economics and Finance, 1(2), 401-415

• Journal Article Type: Article
• Acceptance Date: Nov 8, 2020
• Online Publication Date: Feb 12, 2021
• Publication Date: Dec 30, 2021
• Deposit Date: Feb 15, 2021
• Publicly Available Date: Feb 16, 2021
• Journal: Journal of Development Economics and Finance - Open Access Journal
• Publisher: ARF India
• Peer Reviewed: Peer Reviewed
• Volume: 1
• Issue: 2
• Pages: 401-415
• Keywords: Growth; Economic development; South Asia; India; SAARC
• Public URL: https://hull-repository.worktribe.com/output/3724793
• Publisher URL: http://arfjournals.com/abstract/80470_9_keshab.pdf