“South Asia’s record on human development indicators comes out quite dismal despite India being a part of it,” notes Khadija Haq, the president of the Mahbub ul Haq Human Development Centre in Lahore.

“The region comes way down on every human development indicator — be it education, healthcare, women empowerment, sanitation etc. — when compared with other regions like East Asia.”

Indeed, all South Asian economies barring Sri Lanka’s are placed together in the low human development group in the UNDP’s Human Development Index (HDI). Sri Lanka is the only South Asian country finding a spot in the medium human development category.

Over the last 14 years, Pakistan has slipped 11 places to fall further down on the HDI rung to the 146th position. India has lost seven places to 135th place, and Nepal one spot to 145th position. Bhutan has improved its standing by 10 points to rise to the 136th position, and Bangladesh by two spots to 142nd.

‘Unless you have a good set of economic policies and evenly distribute resources to cut poverty and make everyone participate in the development process, you cannot improve HDIs’

South Asia is also one of the least integrated regions in the world.

Haq holds that South Asia’s backwardness and dismal record of human development are ‘rooted deeply’ in the flawed, imbalanced economic policies pursued by the region’s nations in the past. These policies were encumbered by their anti-poor bias, resulting in uneven growth across sub-national regions and segments of the population.

The lingering political and territorial disputes between some of these countries, like Pakistan and India, has aggravated the situation further and made it more complicated.

“In order to find what has held this region back from making a meaningful progress, we will have to go back to the political economy of the region. Unless South Asian nations reset their policies and priorities and reconcile with their past and settle their disputes, you cannot hope to really see the region developing into an economically prosperous and developed unit with improved human development index rankings,” she tells Dawn in an interview.

“The development models adopted by Pakistan and India, for example, show that unless you have a good set of economic policies and evenly distribute resources (wealth) to cut poverty and make everyone participate in the development process, you cannot improve human development indicators,” she concludes.

Nevertheless, Haq sees a change in the policies being followed by regional governments now. “India, for instance, is doing much better today; non-resident Indians are returning home with their money, which is working very well for its economy. Its growth momentum is picking up.

“The Indians are trying to move towards an even and balanced growth by implementing policies that aren’t hampered by anti-poor bias. They are also doing pretty well on human development. They cannot turn around the economy overnight though; they have just started and will take some time to get where they want to reach.”

She thinks India will be in much better shape 10 years from now. “They will have a vibrant, growing economy and will have resolved many of their problems. It will not be a ‘shining’ India, but it will be far ahead of us. Actually, with the exception of Pakistan, every South Asian country is already forging ahead. Making a projection about Pakistan’s (economic) future is difficult. We will still be laggards, perhaps.”

However, she thinks Pakistan — encumbered by a poor governance system — could benefit from economic developments taking place in the region in general, and in India in particular. “Pakistan can benefit from the spillover of economic growth in India, provided it improves its business and trade relations with New Delhi.”

Yet, in her view, the ‘intractable’ dispute over Kashmir will keep our economy from advancing and our government from cooperating with India. “Politics, particularly the Kashmir dispute, is impeding cooperation in the Saarc region. All Saarc countries except Pakistan have moved on and improved relations with India; they resent us for holding the regional cooperation hostage to the Kashmir issue.”

Haq considers Kashmir as a golden goose for the military, which helps them claim a greater share in national resources and influence civil government policies. “No civil government or prime minister has shown courage to change the Kashmir policy — not even a coma is changed. Politicians will have to show courage if the country has to make progress along with the rest of South Asia.”

Published in Dawn, Economic & Business, October 6th, 2014