Fears of a China-led global slowdown, which had sent global stock markets tumbling, prompted the U.S. Federal Reserve last week to hold off on raising interest rates for the first time in almost a decade.
The ADB said that the capital outflows could accelerate ahead of the Fed rate hike and urged policymakers to strengthen financial systems in the region to mitigate shocks.
"Implementing macroprudential policies and developing local currency bond markets can bolster financial system resilience and mitigate risks to borrowers," it said.
The ADB slashed its growth forecast for South Asia to 6.9 percent this year and 7.3 percent next year compared with the 7.3 percent and 7.6 percent estimates made in July.
India's growth is seen weaker at 7.4 percent and 7.8 percent for this year and next compared with its July forecasts of 7.8 percent and 8.2 percent.
Southeast Asia's growth will be at 4.4 percent this year, same as last year and down from its July forecast of 4.6 percent, before accelerating to 4.9 percent next year, the ADB said.
Inflation in the region in 2015 is now forecast to be a slightly lower at 2.3 percent, compared to the 2.4 percent seen in July, before it bounces back to 3.0 percent in 2016.
The report is available on the ADB's website www.adb.org
GDP GROWTH, pct Actual --Forecast--