"Climate change and natural resource concerns will have a profound impact on our regional goals," Verma said at a conference on improving pan Asian connectivity here.
He said India and Bangladesh are already beginning to feel the impacts - flooding in Jammu and Kashmir last year, in Uttarakhand in 2013 and in Assam in 2012 which displaced 1.5 million people.
"This intersection of climate change, human migration, and governance will present novel challenges for South Asia in the decades to come," he said.
Higher temperatures, rising sea levels, more intense and frequent cyclonic activity in the Bay of Bengal, coupled with high population density levels will create enormous challenges, the envoy said.
Cautioning south Asian countries on the "profound" economic impact of climate change, he said according to a report released by the Asian Development Bank in June 2014, South Asia risks losing an equivalent of 1.8 per cent of its annual gross domestic product by 2050 if the world continues its fossil-fuel intensive energy consumption.
Giving the example of Indus Waters Treaty which was brokered between India and Pakistan by the World Bank in 1960, he said despite their other disagreements, this treaty has helped the two nations resolve many disputes.
"It is considered to be one of the most successful water sharing endeavours in the world today," Verma said.
On trade ties, he pointed that India trades more with Europe, USA, and the Middle East than with its immediate south Asian neighbours.
