Seamless connectivity to create significant economic gains for India, Bangladesh: WB
New Delhi: Seamless transport connectivity between India and Bangladesh has the potential to increase national incomes -- by eight per cent in India and 17 per cent in Bangladesh, according to a new World Bank report released on Tuesday.
The report titled 'Connecting to Thrive: Challenges and Opportunities of Transport Integration in Eastern South Asia' also analyses the Bangladesh-Bhutan-India-Nepal (BBIN) Motor Vehicles Agreement (MVA).
It says regional policy actions the countries can take to strengthen the MVA and proposes priorities for infrastructure investments that will help them maximise benefits.
"Geographically, Bangladesh's location makes it a strategic gateway to India, Nepal, Bhutan and other East Asian countries. Bangladesh can also become an economic powerhouse by improving regional trade, transit and logistics networks," said Mercy Tembon, World Bank Country Director for Bangladesh and Bhutan, while releasing the report.
"While trade between India and Bangladesh has increased substantially over the last decade, it is estimated to be USD 10 billion below its current potential. The World Bank is supporting Bangladesh to strengthen regional and trade transit through various investments in regional road and waterways corridors, priority land ports, and digital and automated systems for trade," she said.
Junaid Ahmad, World Bank Country Director for India, said the eastern sub-region is poised to become an economic growth pole for South Asia. "An important component of this development potential is for countries to invest in connectivity -- rail, inland waterways, and roads," he said.
"This is especially true as the region begins its economic recovery from the COVID-19 pandemic. Ultimately, connectivity offers the promise of long term sustainable and inclusive growth," Ahmad added.
The transport integration agreements in eastern South Asia represent a significant step toward the creation of a cross-border integrated transport market in the subregion with the MVA being the cornerstone of that integration, said Senior Economist Matias Herrera Dappe and Charles Kunaka, Lead Private Sector Specialist, who authored the report.
The agreement can achieve full potential by adopting good practices; addressing gaps and inconsistencies in infrastructure and market failures in transport services, and adopting complementary policies that remove binding constraints caused by market imperfections," they said.
Meanwhile, Prime Minister Narendra Modi inaugurated 'Maitri Setu' between India and Bangladesh on Tuesday via video conferencing. The bridge 'Maitri Setu' has been built over the Feni river which flows between the Indian boundary in Tripura state and Bangladesh.