Key issues and challenges that South Asian countries are facing in Asian century

Running head: INTERNATIONAL STUDIES
Key issues and challenges that South Asian countries are facing in Asian century
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INTERNATIONAL STUDIES
Introduction
Asian Century can be defined as the projected dominant role of Asia in the 21st century
due to its politics, culture, with the assumption of the persistence of some economic and
demographic trends (Lingle). In other words, the dominance of Asia on the world is expected
due to the burgeoning economy and increasingly wealthy middle class of Asia. The idea of Asian
Century is compared to that of the Britain’s Imperial Century that emerged in the 19th century
and American Century in 20th Century. This concept has emerged from the rapid and extensive
growth of the economies of China and India since 1980s, which has pushed these nations to get
ranks among the largest economies of the world (Lo). The South Asian region is also known as
Indian Subcontinent and it includes 8 countries, namely, India, Pakistan, Bangladesh,
Afghanistan, Nepal, Bhutan, Sri Lanka and Maldives. In the 21st century, many Asian countries
have shown remarkable economic and social progress along with China and India, however, the
new Asian century has also brought its own challenges and issues, which influence the economic
and social condition of the Asian countries (Aygen and Logan). This essay will highlight the
position, issues and challenges of the countries of South Asia that are occurring in the Asian
century and will provide a detailed discussion on the key problems and challenges faced by these
countries and their impact on the economies with reference to the political, social and economic
background.
Discussion
According to World Bank, South Asian region is the most populous as well as most
densely populated geographic region of the world. It is also expected to be the fastest growing
region of the world, with projected growth rate up to 7% in 2019, with estimation of 7.1% in

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2020 and 2021. However, it was also predicted that to sustain the high growth and reach the
maximum economic potential, the South Asian countries need to expand its exports. The GDP
forecast is stronger for India, Sri Lanka and Afghanistan while moderate for the other countries.
All these nations contribute a significant amount of GDP to the total GDP produced by the Asian
countries. However, the level of economic development is different among the countries along
with differences in their political, social and cultural background, which influence their
economic performance. In the Asian century, South Asia’s outlook for economic growth includes
measures for balancing the growth rates of imports and exports by decreasing the rate of imports
and accelerating the rate of exports (Siddique and Majeed). However, accelerating export growth
in South Asia is challenging as global trade is weakening, political turbulence is increased, and
balance sheets of both the corporate organizations and the banks are deteriorating. At the same
time, for achieving sustainable GDP growth in the long term, south Asia must narrow down the
infrastructure gaps, which is quite weak and large, throwing a major challenge to the economies
(Bah and Azam).
Similar to any other region of the world, the South Asian region also faces various types
of challenges and issues that have been emerging over the years due to various socio-economic
and political factors. The 21st century is being referred to as the Asian Century as the experts of
economics, political science and emerging markets have identified certain characteristics of the
Asian countries that can dominate the global economy considerably (Romei and Reed). It would
supposedly become an inflection point, at which the continent can become the new cultural and
business center of the world. It is compared with two other ages or centuries that emerged during
19th and 20th century. The Britain’s Imperial Century was identified in the 19th century and the
American century was recognized in 20th century, in which these countries and their economic,

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cultural traditions dominated the global growth (Parsons). In the 21st century, it has been
observed that the Asian countries have achieved a tremendous economic growth, such as, the
Asian countries contributed more than one third of the total output of the world in 2000 (Romei
and Reed). According to the UN Trade and Unctad, Asian economies will become larger by
2020 than the rest of the world combined and that would happen first time since 19th century and
hence, the Asian century is about to begin as Asian countries are ready for economic eclipse of
the rest of the world. In this situation, China and India are leading the trend. The world’s
forthcoming entry into the Asian age is happening not only for the two largest economies, but
also due to the immense and rapid growth of the small and mid size economies.
The economic growth of a region also brings about the influence of the other aspects on
the global scenario that affects other economies. At the same time, these phenomena of
dominance have its own problems and challenges that also affect the economies of that particular
region. In Asia, the South Asian countries have emerged as key variables in the contemporary
international order. Palit and Spittel highlighted that in the last decade, the region of South Asia
experienced a robust growth and development in the economy. Over the next few years, the
economic progress of South Asia is expected to speed up due to strategic location and favorable
demographic condition. However, materialization of the chances of economic growth and
development depends on the ability and efficiency of the region to handle various challenges,
such as, political instability, security issues, climate change and ethnic conflicts (Cohn). Thus,
the transition of the South Asian economies from the status of low income to middle income is
an enormous economic, political and social challenge. During 1980s, the reform policies and
organizational structures helped to gain large supply responses for the South Asian countries,
which boosted its economic growth substantially.