India and South Asia: Economic Developments in the Age of Globalization: Economic Developments in the Age of Globalization

South Asia has become a major center of attention on the world stage with the U.S. military involvement in Afghanistan since 9/11, the ongoing concern over Islamic fundamentalism in Pakistan, and India's emergence as a regional economic power. In addition, the age-old problems of South Asia - mass poverty, poor infrastructure, misgovernance, rampant corruption, political uncertainty, and regional wars - add to the increased interest in the region. Incorporating the most current information available, the expert international contributors to this handbook examine the economies and geo-political developments of India, Pakistan, Afghanistan, Nepal, Bangladesh, Sri Lanka, and Bhutan. They focus on three core areas of importance: trade and development in the post-WTO era of globalization; macroeconomic adjustment and economic growth; and poverty, governance, the war on terror, and social indicators. With its cutting edge analysis, the handbook is an essential reference for all students, researchers, and practitioners dealing with the region. Contents......Page 7 Tables and Figures......Page 9 Acknowledgments......Page 13 South Asia in World Focus......Page 15 South Asia ’s Development Challenges......Page 17 Author Contributions to This Book......Page 21 References......Page 26 Part I Introduction......Page 27 1 South Asia at a Glance A Taxonomy of Growth Challenges......Page 29 The Development Challenges of South Asia......Page 30 Notes......Page 54 References......Page 55 Additional Works Consulted......Page 57 2 The Political Economy of South Asia......Page 58 India ’s Policies Toward the Subcontinent:The Political Dimension......Page 59 India ’s Policies Toward the Subcontinent:The Economic Dimension......Page 65 U.S.Policy Toward the Subcontinent:Political Aspects......Page 69 U.S.Policy Toward South Asia:The Economic Dimension......Page 72 China ’s Policies Toward South Asia:Political Factors......Page 75 China ’s Policies Toward South Asia:Economic Factors......Page 76 Concluding Comments:A Political Economy of South Asia?......Page 77 Notes......Page 79 Part II Macroeconomic Performance and Issues in Economic Growth......Page 85 3 India ’s Economic Growth Miracle in a Global Economy Past and Future......Page 87 Historical Perspectives......Page 89 Theory of Economic Growth and Development......Page 93 Innovation-Based Economic Growth......Page 101 Growth Strategies......Page 104 Summary and Concluding Remarks......Page 114 References......Page 116 4 Twin De .cits in South Asian Economies Observations and Empirical Evidence......Page 119 Twin De .cits:Theoretical Perspective and Empirical Evidence......Page 120 Bangladesh......Page 122 India......Page 127 Pakistan......Page 128 The Historical Trend of Twin De .cits in South Asia......Page 130 Empirical Results......Page 134 Concluding Remarks......Page 139 References......Page 140 Why Does the Fiscal De .cit Matter?......Page 142 The Fiscal De .cit:What Does It Measure?......Page 144 Sustainability of the Domestic Fiscal Debt......Page 147 The Fiscal De .cit Experience in South Asia......Page 148 The Fiscal De .cit Situation in India......Page 149 Toward More Sustainable Fiscal De .cits in South Asia......Page 155 Conclusions......Page 162 References......Page 163 Theoretical Literature on the Effects of Foreign Capital......Page 165 Theoretical Literature on Debt Issues......Page 172 Conclusion......Page 175 References......Page 176 7 Foreign Investment and Economic Growth A Case Study of India......Page 178 Foreign Direct Investment and the Developing Countries......Page 180 Foreign Direct Investment in India......Page 183 Concluding Remarks......Page 193 References......Page 197 8 Human Capital Investment and Development in South Asia......Page 200 The Neoclassical Growth Theory......Page 201 Human Capital and Economic Growth:The Evidence......Page 203 Human Development in South Asian Countries......Page 204 Determinants of Schooling......Page 210 Evaluating the Programs of the Educational Sector......Page 213 Conclusion......Page 218 References......Page 219 What Is Poverty?......Page 222 Extent of Poverty in Pakistan......Page 225 Steps Taken by the Government to Alleviate Poverty......Page 227 Impact of IMF/World Bank Structural Adjustment Programs on Poverty in Pakistan......Page 229 Poverty Trends in Other South Asian Countries......Page 231 Poverty in South Asia:A Comparison with Other Regions......Page 233 Conclusion......Page 234 References......Page 235 Part III Globalization,Trade,and Development......Page 237 Importance of Trade in the South Asian Economies......Page 239 Volume,Composition,and Direction of South Asian Trade......Page 240 Evolution of South Asian Trade Policies and Priorities......Page 243 Engagement in the World Trade Organization......Page 247 Canada ’s Trade Relations with South Asia......Page 252 Notes......Page 257 References......Page 259 11 Regional Economic Cooperation Under SAARC Possibilities and Constraints......Page 260 Free Trade in South Asia:The Empirical Evidence......Page 261 The Experience of Preferential Trade in South Asia......Page 266 The Political-Economy Relations in South Asia: Is There a Role for SAFTA?......Page 272 Conclusion......Page 274 Notes......Page 275 References......Page 276 12 Repositioning SAFTA in the Regionalism Debate......Page 278 The Debate on RTAs......Page 279 South Asian Perspective on RTAs......Page 285 Concluding Remarks......Page 288 References......Page 290 Web Sites......Page 292 13 Market-Oriented Policy Reforms and Export-Led Industrialization The Sri Lankan Experience......Page 293 The Policy Context......Page 294 Manufacturing Performance......Page 301 The Role of Foreign Direct Investment......Page 310 Conclusions......Page 314 Notes......Page 315 References......Page 316 14 Globalization and Economic Development......Page 317 Drivers of Globalization......Page 325 Globalization of the Labor Market......Page 327 Globalization of Capital Markets......Page 329 The Case Against Globalization......Page 334 Implications of Globalization for South Asia......Page 336 Conclusions......Page 340 Notes......Page 342 References......Page 344 Part IV Corruption in Governance and Its Effects......Page 347 15 Decentralization of Governance and Development......Page 349 Departures from the Fiscal Federalism Literature......Page 351 Adapting the Theory of Decentralization for Developing Countries......Page 354 Empirical Evaluation of Decentralized Delivery of Public Services......Page 360 Decentralization and Local Business Development......Page 365 Conclusion......Page 367 Notes......Page 368 References......Page 369 16 Governance Issues in India......Page 372 Corruption Perception Index......Page 373 Broad Governance Indicators......Page 375 Bribe Payers Index......Page 382 References......Page 384 17 Corruption in South Asia Causes and Consequences......Page 386 Corrupt Agents......Page 387 Corrupt Governments......Page 390 Reform in Empirical Research......Page 393 Conclusions......Page 400 References......Page 401 18 Military Expenditure in South Asia A Case Study of Economic Irrationality......Page 406 The Changed Security Environment......Page 408 Milex in South Asia......Page 409 Some Economic and Social Consequences of Arms Races......Page 413 Is Milex Decision Making Economically Rational?......Page 415 The Case for Demilitarization......Page 417 References......Page 420 About the Editor and Contributors......Page 423 Index......Page 427 South Asia At A Glance : A Taxonomy Of Growth Challenges / Anjum Siddiqui -- The Political Economy Of South Asia / Edelgard Mahant -- India's Economic Growth Miracle In A Global Economy : Past And Future / Baldev Raj -- Twin Deficits In South Asian Economies : Observations And Empirical Evidence / Ahmed M. Khalid -- Emergence, Severity, And Contours Of The Fiscal Deficit In India And South Asia / Raghbendra Jha -- Foreign Public Capital And Economic Growth Of Developing Countries : A Selected Survey / Abdul Waheed -- Foreign Investment And Economic Growth : A Case Study Of India / Sajid Anwar And Parikshit K. Basu -- Human Capital Investment And Development In South Asia / Anjum Siddiqui -- Poverty In South Asia : Concept, Measurement And Analysis / Umer Khalid -- South Asia's Trade And Commercial Relations With Canada / Ann Weston -- Regional Economic Cooperation Under Saarc : Possibilities And Constraints / Dushni Weerakoon -- Repositioning Safta In The Regionalism Debate / Saman Kelegama And Ratnakar Adhikari -- Market-oriented Policy Reforms And Export-led Industrialization : The Sri Lankan Experience / Premachandra Athukorala -- Globalization And Economic Development / Sajid Anwar And Bob Catley -- Decentralization Of Governance And Development / Pranab Bardhan -- Governance Issues In India / Desh Gupta And Bhagwan Dahiya -- Corruption In South Asia : Causes And Consequences / Johann Graf Lambsdorff -- Military Expenditure In South Asia : A Case Study Of Economic Irrationality / Geoff Harris. Anjum Siddiqui, Editor. Includes Bibliographical References And Index. Examines the economies and geo-political developments of India, Pakistan, Afghanistan, Nepal, Bangladesh, Sri Lanka, and Bhutan. Focuses on three core areas of importance: trade and development in the post-WTO era of globalization; macroeconomic adjustment and economic growth; and poverty, governance, the war on terror, and social indicators Examines the economies and geo-political developments of India, Pakistan, Afghanistan, Nepal, Bangladesh, Sri Lanka, and Bhutan. This work focuses on three core areas of importance: trade and development in the post-WTO era of globalization; macroeconomic adjustment and economic growth; and more. Incorportaing the most current information available, the expert international contributors to this handbook examine the economies and geopolitical developments of India, Pakistan, Afghanistan, Nepal, Bangladesh, Sri Lanka, and Bhutan in the post-9/11, post-WTO world.