A quick scan of the underlying bonds in the index (google iBoxx), although the index is denominated in USD with a notional value of US$53bn, the underlying bonds appear to be in local currencies across Asia issued largely by governments or closely related entities (eg China, Indonesia, Philippines, Malaysia, Singapore and Thailand).
The duration is 4.65 which is a measure of risk to interest rates. Approximately a 1% rise in rates results in a fall of 4.65% in the fund value.
There is currency risk given the bonds are in different currencies versus that which you use to invest (HKD).
The other risk is that of default by one of the bond issuers.
When managing the fund they can't buy all the bond in the index, so they buy a sample of bonds which they hope will mimic the performance of the index. The index itself gets revised periodically so the manager should respond to these "rolls" as bonds mature, leave and enter the index.
I am not sure, but part of the underperformance could be due to the withholding taxes.