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Demographic change can make powerful contributions to economic growth.  This has strong implications for understanding past growth in South Asia and assessing and shaping its future prospects. This paper attributes some of the improvements that South Asian economies achieved to the rising share of working-age people in the population. However, it notes that the final outcome of demographic transition depends on state policies.

Lessons drawn from South Asian economies’ experiences : 

• a high share of working-age people is beneficial only if those people are employed, thus labour market policies must encourage employment
• similarly, investment in access to healthcare and education is crucial for ensuring that working-age people are prepared for the demands of the economy
• an economy that has persistently high inflation is unlikely to be able to take the best possible advantage of a large segment of working-age people
• the idea that services, rather than manufacturing, are particularly effective in leading to sustainable growth should be reflected on the education offered to students entering the workforce
• trade policy matters; a large working-age population can benefit by having a country’s products succeed in the external market, while imports bear potential risks for workers
• if governments are not up to providing infrastructure and efficient policy environment, a potential demographic dividend may be squandered
  

In addition, the document indicates that relations with other countries and with international financial organisations matter and can be important in potentiating economic growth.

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