World Bank Recasts South Asia, Putting India at the Center

Without moving a single border or any grand gestures, the World Bank has redrawn the mental map of South Asia, as if wielding a magician’s wand!

With a quiet yet significant shift, the WB has moved Pakistan and Afghanistan out of its South Asia region and placed them into the Middle East and North Africa group. As a result, what remains of the current South Asia region is a cohesive set of countries, with India holding a prominent, central position! This seemingly technical realignment results in a new grouping, which now includes India, Bangladesh, Nepal, Bhutan, Sri Lanka, and the Maldives.

However, behind the scenes, this move reflects something deeper. It reflects a growing recognition in the West of India’s economic strength, political stability, and its increasing ability to shape regional development goals.

India’s Quiet Climb

For years, India has been making efforts to move out of the shadow of its turbulent neighborhood. Grouped alongside countries facing war, political instability, or chronic debt, India often found itself painted with the same brush. The World Bank's move changes that. By moving Pakistan and Afghanistan into a different administrative region, the World Bank has given India a cleaner stage, surrounded by countries with which it shares more productive ties and development goals.

While India has not made any formal statement, officials familiar with the matter say this was long overdue. One senior economist remarked, "India has earned this. It has been steadily building credibility, not just as an economy, but as a country that can think long-term and deliver on its commitments."

New Power, New Pressure

This decision brings only advantages for India. It could gain greater influence in setting regional lending priorities and push for developmental frameworks that emphasize transparency, sustainability, and digital innovation. It will also be able to engage more freely with neighbors like Bangladesh and Nepal, without the constant friction that came from being part of a group that included Pakistan.

But there are challenges too. With more say comes more responsibility. India will be expected to lead by example, support regional partners more visibly, and invest in infrastructure and connectivity projects that benefit the subcontinent as a whole. There is also the risk that this change could widen the already growing gap between India and Pakistan, making future cooperation even harder to imagine.

For Pakistan and Afghanistan, the move is likely to be seen as yet another sign of declining institutional support. Both countries face serious economic and governance challenges, and this reclassification may reinforce their sense of regional isolation. In private, some officials in Islamabad have criticized the decision, calling it unfair and geopolitically motivated. But the silence from the World Bank suggests that this was a well-considered step, not a spur-of-the-moment adjustment.

Looking ahead, this moment might be remembered as more than a bureaucratic change. It may come to symbolize the point at which India stepped out of a limiting regional narrative and began shaping one of its own.

Because the future of South Asia won’t be determined just by who shares borders. It will be shaped by who has the vision and the will to lead.

(The writer is a seasoned Banker and Mortgage Specialist working for India’s largest loan distributor company and occasional political commentator.)