By Bilawal Hammad
Your commercial awareness dose
South Asia is the least connected and integrated region in the world. Regional co-operation and integration are imperative in this prevailing world economic order. Regions like Europe, North America, South America, South-East Asia, East Asia and Central Asia are more connected and integrated as compared to South Asia. These regions give a great value to trade, investment, policy-making framework and people to people exchange amongst themselves. Integration and co-operation in South Asia are at its nadir. The abysmal state of integration and connectivity is due to multiple reasons.
South Asia comprises of 8 countries namely Afghanistan, Bangladesh, Bhutan, India, Nepal, Pakistan, Maldives and Srilanka. These all nations are members of SAARC (South Asian Association of regional co-operation). SAARC was formed in 1985 on the initiative of the former prime minister of Bangladesh, Zia-Ur-Rehman. The purpose of the formation of SAARC was to ensure socio-economic, political co-operation and cultural connectivity. South Asian nations have a common heritage, history, linguistic, culture and social practice.
Even with so much in common, the state of connectivity and co-operation is below par. SAARC, as a regional organization has failed in its initiative and targets. The reason being the lack of will of member nations to connect and regional politics. The animosity between India and Pakistan is the lynchpin to the least co-operation and connectivity in South Asia. These two nations are traditional enemies and are poles apart since its inception. There are a lot of differences between these two nations, but the main problem is the Kashmir issue.
Such outstanding issue leads to minimal connectivity among these two nations. It must also be kept in mind that these two nations prefer to solve their outstanding issues through bilateral meetings and avoid third party involvements. SAARC as a forum, has tried to solve matters between them and offered its platform to resuscitate their relationship but was to no avail.
India refuses to attend the SAARC summit which is to be held in Pakistan, and same is the case with Pakistan. Due to these two nations sub regionalism is prevailing in South Asia in the form of SASEC (South Asian sub-regional economic co-operation) and BIMSTEC (Bay of Bengal initiative for multi-sectoral, technical and economic
co-operation).
Another major issue of South Asia is terrorism. Countries like Afghanistan, Srilanka, India,
Bangladesh and Pakistan have not been able to curb the excesses of terrorist and their activities. Militant organizations have played an effective role in causing a chasm between South Asian nations. In recent years military co-operation is at its pinnacle to fight militarism and terrorism in South Asia. Regional trade in South Asia is 4% of its total trade with the outside world.
This figure is the lowest in the world. Regional trade in Europe is 67%. Whereas in North America and South East Asia, it is 62% and 26% respectively. SAPTA (South Asian preferential trade agreement) was signed in 1995. This preferential trade agreement could not be able to increase intra-South Asia trade. Later on, SAFTA (South Asia free trade agreement) was signed in 2006. It was agreed in SAFTA that custom duties among South Asian nations would be brought down to 20% by 2009 and will be further decreased to 0% by 2012.
14 years have passed, and nothing conclusive has happened as negotiations are still in process and nothing has been concluded yet. South Asian nations should ensure:
· market integration through enhanced cross border trade and investment;
· Development of transport, energy and people to people exchange;
· Greater financial co-operation;
· Increase economic and technical co-operation to address shared vulnerabilities and risk.
South Asian nations should at first priority give a practical shape to SAFTA (The South Asian Trade Agreement). This will boost intra-South Asia trade. People to people exchange is indispensable to regional connectivity and integration in South Asia. Track II and III diplomacy must be assured to achieve this specific purpose. Economic and financial co-operation is tantamount to connectivity and integration. Measures must be taken for socio-economic and financial interdependence.
We can conclude from the above discussions that South Asia as a region is least connected and integrated. Intra-South Asia trade is the lowest in the world as compared to trade in other regions. Therefore South Asia nations must take stringent steps to get more connected regionally and ensure inclusive, more sustainable growth and development in South Asia.
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