Driving Regional Growth: How PACT Powered Cross-Border Links in Asia’s Heartland

PACT, a World Bank and UK-FCDO initiative, catalyzed over $8.2 billion in investments to enhance regional trade, energy, digital, and knowledge connectivity across South and Central Asia. Through strategic research, infrastructure upgrades, and inclusive policy reforms, it transformed cross-border cooperation and economic integration in the region.

In a transformative six-year effort, the World Bank and the UK’s Foreign, Commonwealth and Development Office (FCDO) joined hands under the Program for Asia Connectivity and Trade (PACT), aiming to reshape economic cooperation in South and Central Asia. Backed by £21 million in funding, $23.3 million disbursed, PACT targeted regional fragmentation by investing in transport, digital systems, energy markets, and institutional platforms. With PACT- financing, the World Bank-led analytical work with more than 100 technical and analytical reports. PACT-supported activities and analysis further influenced and leveraged more than $8.2 billion in World Bank investments. Administered through the Bank’s South Asia Regional Integration and Engagement (RICE) framework, PACT took forward the agenda previously shaped by programs like the South Asia Regional Trade Integration Program (SARTIP), using connectivity as a tool for inclusion, resilience, and long-term development.

From Choked Borders to Modern Gateways

One of PACT’s most substantial impacts was in the realm of trade and transport. In a region where trucks crawl at 15 km/h through congested borders, PACT helped identify bottlenecks and craft real solutions. The program supported technical studies that laid the groundwork for over $1.5 billion in investments across Bangladesh, Nepal, and Bhutan under the World Bank’s ACCESS program. In Nepal, road sections such as Butwal-Gorusinghe-Chanauta were selected for freight upgrades. In Bangladesh, modernization was proposed at three of the busiest land ports, Benapole, Bhomra, and Burimari, where manual customs procedures and mismatched infrastructure previously created six-day-long clearance delays. PACT didn’t stop at roads; it also revived interest in inland water transport, commissioning studies to improve navigation in the Sundarbans and promote multimodal trade between India and Bangladesh. Central Asia, too, benefited from corridor diagnostics and value chain integration. In Tajikistan, PACT supported agribusiness linkages under the Rural Economy Development Project, improving trade access for remote mountain regions. These efforts brought immediate human dividends. In Darvoz and Rushan districts, improved sanitation and tourism infrastructure led to a spike in homestay visits and artisan exports, helping turn economic isolation into opportunity.

Lighting Up the Grid: A Regional Energy Breakthrough

PACT’s energy interventions were equally groundbreaking. Traditionally, cross-border electricity trade in the region was limited to cautious bilateral arrangements. PACT changed that. With its support, the World Bank helped develop a 2,500 MW pipeline of cross-border energy projects in South Asia. This included major undertakings like Nepal’s Upper Arun Hydropower Project, the Butwal-Gorakhpur interconnector with India, and Bhutan’s Dorjilung project. The South Asia Power Secretaries’ Roundtable (PSRT), which PACT supported in nine of its seventeen total sessions, became a crucial forum for building trust among nations like India, Bangladesh, Nepal, and Sri Lanka. In 2024, this culminated in a landmark agreement allowing Nepal to export electricity to Bangladesh via Indian infrastructure, marking the region’s first trilateral electricity trade deal. Central Asia, too, saw renewed energy dialogue. PACT-backed analyses supported the CASA-1000 project, linking Kyrgyz and Tajik hydropower to Afghanistan and Pakistan, and informed a $1 billion regional electricity market initiative. Estimates suggest Central Asia could earn up to $6.4 billion by 2030 through improved electricity trade. By 2022, cross-border transmission capacity in South Asia had already tripled from 2.1 GW in 2015 to 6.4 GW proof of how PACT helped convert cautious collaboration into a robust power grid.

Closing the Digital Divide Across Borders

While roads and wires matter, PACT understood that true connectivity also meant digital inclusion. Its contributions to the World Bank’s broader digital strategy were both strategic and timely. The flagship report unpacked challenges in affordability, regulation, and digital literacy across the region. In Sri Lanka, PACT contributed to drafting the Cybersecurity Bill and helped shape the national digital economy strategy adopted in May 2024. The program also convened a Regional Digital Network with stakeholders from the BBINS countries, Bangladesh, Bhutan, India, Nepal, and Sri Lanka to address policy gaps on data flows and trust infrastructure. In Bangladesh, PACT-funded research explored how e-commerce platforms like HelloTask could help informal domestic workers, especially women secure flexible, safer employment. In Central Asia, efforts focused on enhancing broadband access in Tajikistan, Uzbekistan, and Kazakhstan, and laying the foundation for a 362 km Trans-Caspian submarine cable to link Kazakhstan and Azerbaijan. These projects were not only about technology but about shifting the economic possibilities for entire populations.

Knowledge Networks and Youth as Agents of Change

PACT didn’t just build infrastructure, it built relationships. The South Asia Champions Process, facilitated through thirteen PACT-supported convenings, brought together senior policymakers and academics to shape regional policy on trade, labor mobility, digitalization, and climate cooperation. Meanwhile, the South Asian Economics Students’ Meet (SAESM), active since 2004, received continuous support, culminating in its 20th anniversary meet in Colombo in 2024. A recent tracer study revealed that for 89% of SAESM participants, it was their first cross-border experience, and 78% remained in touch with peers afterward. These soft power outcomes are critical in a region where geopolitical tensions often undercut economic logic. In Central Asia, PACT also supported the RESILAND CA+ initiative, empowering youth in five countries to develop nature-based climate solutions and green entrepreneurship models.

PACT also made inclusion a core objective. Gender-disaggregated data from a 43,000-household COVID-19 monitoring study informed social protection responses. Infrastructure projects integrated gender-sensitive design, such as childcare facilities and women’s service desks at customs houses. Women-led conservation efforts in the Sundarbans and digital health initiatives further demonstrated how PACT mainstreamed equity into the regional integration agenda.

As the program closes, its legacy is clear. PACT offered more than project support it offered a new model of regionalism driven by knowledge, trust, and shared benefit. In connecting people, systems, and ideas across some of the world’s most complex borders, it proved that connectivity isn’t just a means to growth it is growth itself.