Countries in the South Asian countries Region (SAR) face a number of functional and economic challenges as they seek to keep up with rapidly growing electricity demands. Our analysis finds that increased regional electricity trade facilitated by expanded cross-border transmitting interconnections among SAR countries can contribute significantly to alleviating these challenges . Cross-border electricity industry could save as much as US$94 billion (in present value terms) in the area during the 2015-2040 period. It would slow up the regional power sector CO2 emissions during the period by 8% also without pro-active measures to reduce CARBON DIOXIDE or harmful local pollutants. Moreover, significantly increasing cross-border interconnection plus trade will necessitate taking measures that inevitably will reduce substantial existing inefficiencies in national power systems in the region, as well.