Benchmarking South Asian Economic Performance

South Asian economies, particularly India and Bangladesh, experienced a remarkable economic transformation during the last three decades. This has resulted in a significant reduction in poverty levels in the region. This chapter examines the overall economic performance of four South Asian countries, namely Bangladesh, India, Pakistan, and Sri Lanka, compared to four Southeast Asian countries: Malaysia, Thailand, the Philippines, and Vietnam. In doing so, the chapter attempts to answer the frequently asked question in the literature: is South Asia catching up with Southeast Asia? Overall, South Asian countries demonstrated steady economic growth, despite some fluctuations, during the last three decades. However, the growth of all countries was adversely affected by the COVID-19 pandemic, with most countries reporting a negative growth rate. Interestingly, all South Asian countries under consideration except Sri Lanka bounced back and showed an even stronger economic growth rate in 2022. The adverse effects of the COVID-19 pandemic and the Russian-Ukrainian war on South and Southeast Asian economies were also visible with increasing inflation rates in many countries. In particular, among all the countries studied, Sri Lanka and Pakistan appeared to be the most struggling countries, with highly depreciated currencies, increased debt burdens, and problematic macroeconomic indicators.