Economies of South Asia

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  • 0:00 The Economy of India
  • 1:45 Pakistan and Afghanistan
  • 2:55 Sri Lanka and the Maldives
  • 3:45 The Economy of Bangladesh
  • 4:15 Nepal and Bhutan
  • 5:10 Lesson Summary
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Lesson Transcript
Instructor: David Wood

David has taught Honors Physics, AP Physics, IB Physics and general science courses. He has a Masters in Education, and a Bachelors in Physics.

After watching this video, you will be able to describe the economies of South Asia and how they differ from one another, including sectors, imports, exports, and trade. A short quiz will follow.

The Economy of India

In this lesson, we'll be looking at the various economies of South Asia. South Asia is the area usually considered to include Afghanistan, Bangladesh, Bhutan, India, the Maldives, Nepal, Pakistan, and Sri Lanka. It's one of the most populated parts of the world, with a total of 1.6 billion people. Let's start with the largest economy: India.

The economy of India is largely a capitalist, free-market economy, similar to most Western countries. However, the government is often described as containing a lot of corruption, and India is low on the human development index. India's economy is the seventh largest in the world by GDP, or gross domestic product, and is third in purchasing power. Like many Western countries, most of its GDP is in the service sector. Industry and agriculture are also important. In fact, most Indian employment comes from the agricultural sector.

In recent decades, India has become a big supporter of free trade. It's a member of many trade organizations, including the World Trade Organization (WTO), the South Asian Free Trade Area (SAFTA), BRICS, and the G-20, among others.

India's main exports are software, petrochemicals, agricultural products, jewelry, engineering goods, and pharmaceuticals. India's important imports include oil, gold and precious stones, electronics, engineering goods, chemicals, plastics, coal, ores, and metals.

The Economy of Pakistan & Afghanistan

Pakistan's economy is relatively modest. It's very much a developing country, with war and social instability, along with a lack of basic services, like transport and electric power. Agriculture is more important in Pakistan than in India, though services and industry are also important economic sectors. Much of the industrial centers lie along the Indus River. Like India, Pakistan supports free trade. Its main exports are linens, cotton, yarn, and rice, and its main imports are oil, chemicals, machinery, and food.

Afghanistan is similarly a developing country - one of the least developed in the world in fact - and has struggled for years due to unsuccessful regimes and war. About one third of the population is unemployed and a similar number live below the poverty line. But the economy has improved after receiving billions of dollars of international aid and investments. It only became a free market economy in 2002, after previously being a planned economy. The vast majority of the country's economy comes from agriculture, and its main exports include opium, fruit, nuts, wool, and cotton.

The Economy of Sri Lanka & the Maldives

While Sri Lanka has spent much of its history as a developing, impoverished country, in recent years, unemployment has plummeted, partly due to free trade. Sri Lanka is a member of the WTO and SAFTA, for example. Much of its economy is based in tourism, textiles, and agriculture. Its main exports are textiles, pharmaceuticals, tea, spices, and gemstones. Its main imports are fabrics, minerals, oil, food, and machinery.

The Maldives has a major service economy (at 78%), largely in the form of tourism. Tourism has led to rapid improvements in infrastructure. Industry is also important, and only a small portion of the population is involved in agriculture. Its main export is fish, and its main imports are oil, ships, food, and clothes.

The Economy of Bangladesh

Bangladesh is a developing country, but it is growing rapidly. Much of this growth is centered on export-driven industries, and the textile industry is the second largest in the world. It is part of numerous trade organizations. Its economic sectors are mixed relatively evenly between agriculture, industry, and services, and its main exports are textiles, food, porcelain, and china. Its main imports are oil, machinery, food, and metals.

The Economy of Nepal & Bhutan

The economy of Nepal has been growing, though agriculture is still the heart of its economy. But a quarter of the population remained below the poverty line in 2008. Its main industries are tourism, clothes, and food, and it's a member of the WTO. Nepal exports a wide variety of goods and imports oil, gold, and machinery.

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