• Update the SA RICE strategic framework, given the evolving context (especially COVID-19) following a highly consultative (internal and external) process • Establish inclusive processes for identifying priorities and programing resources (current and pipeline) • Reinforce regional aspects of country programs • Provide framework for engaging with Development Partners In its 10-year history, the SAR RI program has matured significantly and has yielded important results and lessons RICE relevance has increased in the post-COVID period while facing new risks and opportunities RICE will maintain its focus on: (i) Enabling Economic Key Connectivity and (ii) Reducing vulnerabilities and building resilience, and will expand work in (iii) Investing in Messages Human Capital Embedding RICE into country operations is key to success SARRE will maintain high standards to implement RICE through financing, influencing, convening and partnering, and internal governance will be strengthened to support this RICE Portfolio has expanded with transport and energy leading the way • Regional IDA 19 projects (17 active) with total commitments of US$3.4b. Transport (50%), energy (27%), and climate resilience (10%); two IDA grants to regional institutions for climate resilience and management of plastics; first HD project in education under preparation • Regional TF Programs total contributions of US$225m addressing critical transboundary issues in trade, connectivity, water, and climate change (key partners: DFAT, DFID, EU, Norway) • Regional TFs have informed/ leveraged over US$19b of WB operations in SAR (analytics, feasibility studies, project preparation and design, implementation, technical and capacity building support) Implementation of Regional IDA in SAR has yielded important lessons • Meeting the three-country eligibility criterion is challenging in SAR. Most projects have been single-country, requiring exceptional waivers. India is central to regional projects but IBRD status presents a challenge for use of Regional IDA. • Challenge in demonstrating regional spillover effects • Use of Regional IDA has been on first come first serve basis limiting opportunities for strategic allocations • SAR Regional IDA portfolio quality on par with rest of portfolio – implementation challenges linked to client capacity, slow procurement, safeguards; not to the regional nature of the projects 1. Shaping the narrative and generating new knowledge Informing data-driven decision making and developing WB pipeline investment Shaping the narrative • The Glass Half Full report supported dialogue with senior officials from Bangladesh, Pakistan, India, Sri Lanka (including the Prime Minister) and directly informed the India – Bangladesh MoU on border haats (local markets). • The WEB of Economic Corridors of South Asia flagship report brings new knowledge on prioritizing economic corridor investments. • A ground-breaking South Asia Hotspots study brought new research on impacts of climate change on living standards. Generating operationally relevant knowledge • Feasibility studies inform connectivity investment decisions with Central Asia (e.g. Mazar-e-Sharif- Herat railway line project). • TA and analytics strengthen gender dimensions in infrastructure investments and government schemes e.g. Buddhist Circuit activity helped refine national programs in India, Bhutan and Nepal • Bangladesh’s Ministry of Commerce adopted recommendations on 4 priority value chain designs. • A Rapid Assessment of Water in India’s North-East Region was used by the High Level Committee in a report to the Prime Minister’s Office. This list is illustrative not exhaustive 2. Partnerships and Convening Platforms for dialogue, diplomacy and strategic communications are reframing debates and building consensus • The SAR Regional Champions Group, Power Secretaries Roundtables and Regional Ecological Integrity Platform (REIP) are helping to drive RI agendas nationally, fostering collaboration, and identifying new entry points. • Transboundary water dialogues (three river basins, one landscape) are building trust and progressing collaborative action towards water governance. • South Asia Regional Hydromet Forum convenes over 100 stakeholders for regional collaboration on hydromet, early warning and climate services. • Support to regional institutions (e.g. ICIMOD, SACEP, RIMES) and networks (e.g. South Asia Economic Network) help extend reach to key influencers in South Asia and implementation capacity. This list is illustrative not exhaustive 3. Capacity and Systems Strengthening Critical technical support is strengthening client readiness and facilitating shifts towards efficient investments in transformational regional projects • Supported modern Trade Portals in Nepal and Bangladesh and refurbished trade logistics infrastructure at key border posts in Nepal (Bhairahawa and Birgunj). • Development of Electronic National Single Windows (NSW) in Nepal and Bangladesh facilitates trade by allowing filing of import/export information via a single electronic gateway. • Toolkits on Labor Law Compliance in India adopted by Kerala and Tamil Nadu state agencies. These support government compliance with national labor laws and WBG guidelines for investment lending, with benefits for women, children and vulnerable groups to mitigate potential risks from enhanced connectivity and labor mobility. • First of its kind basin modelling (Brahmaputra basin; Ganges river in India), and hydromet design (Sundarbans landscape) were taken up by government agencies. • New fiscal tools and economic models are helping to bring climate issues into policy making. • New regional Electricity Planning Model developed to assess project-level and regional trade benefits • Strengthening gender dimensions in WBG investments – e.g. Inland Water Transport projects and Bangladesh WeCare have stronger gender components (safety, access to markets, mobility, etc.) This list is illustrative not exhaustive 4. Policy Influence RICE activities are contributing to policy change through evidence and knowledge Transport and Trade • Supported regional (India-Bangladesh) pilot voyages for bulk and container freight which helped to inform the bilateral dialogue on trade and transit protocol and harmonization challenges • Supported inclusion of IWT as an alternate mode of transport in the India-Nepal bilateral trade and transit treaty Energy • Supporting improved policy environment: India’s Policy Guidelines for Cross-Border Electricity Trade (2018)/ Regulations (2019), Nepal and Bangladesh MoU on Energy Cooperation (2018), South Asia Forum of Infrastructure Regulation Joint Working Group on regional power market development • Supported political alignment processes and TA to develop a first-of-its-kind CASA-1000 project connecting surplus energy in Tajikistan and Kyrgyz Republic to Afghanistan and Pakistan Human Development • 7 multisectoral and evidence-based food and nutrition policies/programs/action plans developed and adopted by governments of which 4 support women and girls of reproductive age and/or children <2 years This list is illustrative not exhaustive 5. Development Outcomes Emerging benefits important to demonstrate success and build stakeholder confidence in RICE Energy • Four regional hydropower investments (US$5 billion pipeline) will deliver 3000MW clean energy • 1900MW additional cross-border transmission capacity between Bangladesh-India; India-Nepal Transport • Improving navigability of 2,300 kilometers of Inland Waterway corridors in India and Bangladesh • Upgrading over 500 kms of regional road corridors that carry the heaviest freight volumes will help reduce time and cost of transport which is critical to trade competitiveness Water and Climate Resilience • Flood modeling systems tested by Bihar during 2018 floods - enabled 1-3 day forecasts with real time hydromet data from Bihar and Nepal; scaled up by WB project in 29 states, 11 central agencies • Support to high-level Bangladesh-India Sundarbans Regional Cooperation Initiative (BISCRI) enabling dialogue among policy makers towards action on joint management of the Sundarbans landscape Human Development • Design, implementation or evaluation of 13 World Bank nutrition-sensitive projects, totaling US$2.2 billion and reaching 16.2 million beneficiaries This list is illustrative not exhaustive Lessons of 1. SAR’s dynamic and complex political economy experience: requires an agile and opportunistic approach 2. Sub-regional cooperation lays effective building blocks What for the future – BBIN, BBINS, CASA 3. Dialogue and knowledge platforms powerful worked well mechanism to progress regional agenda by fostering trust, and moving from disbelief to engagement 4. Pilots and scalable initiatives can demonstrate wins and act as drivers of regional cooperation 5. Anchoring regional work in country operations critical for sustainability 6. Working with technical institutions (regional and national) builds ownership, extends Bank’s reach and ensures sustainability e.g. ICIMOD, SACEP 7. Timely generation and targeted dissemination of accessible, layman-friendly regional evidence can influence government investment decisions Lessons of 1. Regional organizations in SAR generally weak and experience: hampered by political context, hence unable to provide leadership, coordinate across countries, or lead What implementation of WB projects 2. Analytical work has limited impact without an operational worked less hook: clear plan of action for use and stakeholder engagement critical to embed / mainstream in partner well systems thereby enhancing sustainability 3. Gender mainstreaming remains a challenge, particularly for infrastructure projects 4. Experience with engaging the private sector mixed: lack frameworks to systematically work with private sector as agents of change; more opportunities to engage with IFC 5. Country ownership of RICE remains limited: scope to incentivize this including through SCDs, CPFs and Regional IDA 6. Institutional capacity building support as follow-up to analytical tools should be encouraged in all activities Overall Learning • Most promising outcomes were increased knowledge exchange From and clients’ enhanced understanding of regional benefits and regional issues IEG’s Two • WBG contributed, to a lesser extent, to regional policy harmonization and formation of new regional institutions or functional agencies to Tango South Asia Report • Small States want access to regional markets and exports but outcomes below potential World Bank’s Independent • Misalignment between Country Strategies, RI Approaches and Evaluation Group Client Demand (IEG), 2019, Two to Tango: An • Irrespective of the administration, SAR Champions hold influence Evaluation of World Bank Group and are of strategic value to Client Governments Support to • Expand sector engagements beyond Energy and Transport Fostering Regional Integration • SAR Regional TFs crucial for WB to effectively play an enabling and convening role which is vital in South Asia Can SAR’s positive momentum towards regionalism be maintained… • Increasing sub-regional cooperation • BBIN Motor Vehicles Agreement, CASA 1000, BBINS Energy Cooperation, China Pakistan Economic Corridor (CPEC) • Realization that regional cooperation can benefit domestic growth • Move from bilateral to trilateral or multilateral frameworks and agreements • Global focus on cooperation in SAR • BRI, Indo-Pacific Strategies of Australia and USA • Changing geo-politics of Central Asia • Route to ASEAN viewed through eastern neighbours • India’s Act East Policy, Neighbourhood First • SAR leaders used SAARC platform to launch COVID-19 Emergency Fund • Cooperation among countries for medical and essential supplies …or will COVID-19 pose a threat to regionalism in SAR? • Increased inward focus of national governments: export restrictions, trade disruptions, plans for reshoring and self-reliance • Reversal of years of gains in poverty reduction and economic growth could drive policy focus towards domestic agenda rather than regionally coordinated policies • Added stress of meeting the combined challenges of health emergencies, climate change, natural disasters (e.g. locusts) and border tensions • Fragmented health and education responses - SAR only region without a regional disease surveillance network; limited cooperation in education • Return of migrants (intra-country and international) and significant decline in remittances to South Asia begs for coordinated approaches Global and regional crises call for global and regional solutions COVID-19 has caused economic deceleration at the regional and country levels South Asian economies are experiencing economic Growth in the region is projected to register a deceleration. The Maldives is expected to experience contraction of -2.7 percent in 2020 instead of the deepest contraction in 2020 in the region, of 13 5.5 percent pre-pandemic forecast. percent, due to high dependence on tourism. RICE could lead to significant welfare gains, especially for the smaller SAR countries Table reproduced from: UNESCAP. 2018. Unlocking the Potential of Regional Economic Cooperation and Integration in South Asia: Potential Challenges and the Way Forward. Page 10. Potential benefits from RICE across sectors What our stakeholders are saying….. • SA RICE Approach should to be selective and strategic while remaining opportunistic in what and where it engages. • A sub-regional lens is key for advancing the RICE agenda in SA. • South Asia lacks a regional narrative and WB should build the RICE narrative at every level: country and sub-national, sub-regional, and regional. • WB’s Knowledge and Convening Power is a key value-add for RICE, and dialogue platforms—well constructed with clear goals and objectives—combined with robust analytics, can be impactful (e.g., SAR Champions, Power Secretaries). • RICE work in South Asia is a marathon (not a sprint) and needs commitment for the long haul. • Challenge of internal Bank structure and incentives for RICE agenda: CMUs focused on country-level needs, logistics of multi-country work is more challenging. RICE approach has three pillars Enabling Economic Connectivity Digital: Regional Connectivity (South Asia, Central Digital: Supporting digital policies and applications Asia); Digital Economy for South Asia regional study across a wide array of sectors Energy: South Asia Regional Electricity Market (SAREM) Energy: Scale up investment in regional green power Program, CASA-1000, Regional Hydropower, Cross and transmission, policy and regulatory alignment for Border Transmission trade, mitigating impacts of Covid-19 Governance: Better tax policies and procurement Finance: Cross-border investments and strengthening MSMEs for international trade; e-payments Tourism: Buddhist Circuit, Tourism in NE India Tourism: Increased intra-regional tourism and gender Trade: Trade and regional linkages, Value chains, inclusion trade in services, Fiscal model and risks, trade with East Asia Trade: Mitigating impacts of Covid-19 Transport: Waterways, Logistics, Economic Corridors, Transport: Green, inclusive, multi-modal economic Railway, Roads, and Roads Safety corridors Reducing vulnerabilities and building resilience Agriculture: Agri-water nexus in NE India Agriculture: Resilient, inclusive agriculture and regional value chains Environment: Blue economy, Watershed mgmt., water quality, plastics Environment: Sustainability of regional environmental goods; air quality management Poverty & equity: COVID-19 monitoring system, Globalization & women’s labor market, women Poverty and equity: Statistics & data collection at entrepreneurs regional level Social: Gender platform, Non-farm employment, Urban and Resilience: Shared resources on disaster Mitigating negative impacts of connectivity forecasting and green cities Urban & Resilience: Early warning/Hydromet, Water: Transboundary water management Adaptation & resilience Water: Water management through South Asia Water Initiative Investing in Human Capital Social Protection: Social protection for migrants Social Protection: regional approaches to safe, during the COVID-19 crisis inclusive migration Education: First regional education project (HEAT) HNP: Regional approaches to health to further resilience and reduce vulnerabilities Education: Regional approaches to education in wake of COVID-19, higher education acceleration and transformation (HEAT) What risks do we face • Political: reduced interest to act by national / regional stakeholders, opposing incentives countering RICE approaches, national interests outweigh regional ones • Institutional: limited and uneven capacities and systems across agencies / countries to take collaborative action, limited knowledge and evidence to inform decision making • Operational: limited availability of specialist technical expertise, implementation delays, worsening security situation • Financial: limited private or public sector resources; perception of high risk; instruments limit delivery options • Shocks: disasters, weather-related events, global or regional economic and resource shocks, health emergencies and pandemics • Internal: mismatch of regional and country priorities SARRE’s Approach: working with and through others SARRE Regional Trust Funds Program for Asia Connectivity and South Asia Trade Facilitation Program for Asia Resilience to Climate Trade (PACT) Program (SARTFP) Change (PARCC) To improve pro-poor connectivity To support economic growth and To increase the resilience of SAR countries infrastructure and policy reforms, with women’s economic empowerment to climate change by fostering regional the longer-term goal of contributing to through trade and connectivity cooperation, supporting delivery of increasing trade and investment, primarily along the Eastern Corridor improved weather and climate reducing cost of sustainable energy, of South Asia. information services and increasing the and enhancing resilience in selected use of such services in planning and countries in Central and South Asia. South Asia Regional Infrastructure decision making across climate affected Connectivity (SARIC) sectors, and promoting innovation. South Asia Water Initiative II (SAWI) To increase regional cooperation in To enable economies of South Asia to the management of the Himalayan become better integrated and more River systems to deliver sustainable, resilient by unlocking potential for fair and inclusive development and private and MDB lending in transport climate resilience. and energy.