South Asian children would suffer most from government complacency. But to do so, most of the poorest Asian economies would have to grow at rates close to the peaks experienced by the most dynamic economies in the region, agricultural productivity would have to reach the levels achieved during the heyday of the Green Revolution, and Asian governments would have to make significant new investments in agriculture and rural areas and spend 50 percent more annually on social programs. Although, realistically, South Asia would need to take a longer view, China and Southeast Asia could reasonably eradicate child malnutrition by 2020. Although the region's economy has hit a rough spot, governments must not turn away from a market orientation if they are to carry through the transformation. Rather, they should support the private sector where possible and supplement it where its growth is not sufficiently compatible with poverty alleviation and environmental improvement.
Good governance is another key to sustained growth.
Transparent and responsive governments must increase the level of investment made in rural infrastructure, agricultural research and extension, education, and health, and expand the reach of social safety-net programs. Some countries could meet a significant part of these costs by reducing wasteful public expenditures in rural areas, particularly on input and credit subsidies, and by improving the efficiency of public institutions. Natural resources should be better managed as well. Completion of the rural transformation, radical reduction in poverty, and improvement in food security in rural Asia are attainable if governments resist complacency. The objective of the study was to identify, for the ADB's developing member countries in Asia, policy and investment priorities that will promote sustainable development and improve economic and social conditions in the rural sector.