By Ram Kumar Jha and Saurabh Kumar
The focal theme of the 18th SAARC Summit being hosted by Nepal in Kathmandu from Nov 26-27, 2014 is ‘Deeper Integration for Peace and Prosperity’.
This summit can take a hard look at infusing vigour and vitality into economic diplomacy, though it is commencing after a three-year gap. In its 29-year old history, the South Asian Association for Regional Cooperation (SAARC) has been criticised for its failure to achieve tangible success, unlike other regional groupings. Thus the Kathmandu summit offers an opportunity to build on earlier initiatives that can potentially alter the current scenario of disheartening cooperation.
Since its inception in 1985, SAARC is working for development and economic welfare of the region. Over the years, the agenda of SAARC has expanded considerably, exhibiting the intent and capability to work collectively on issues of agriculture and rural development; health and population; women empowerment, youth and children; environment and forestry; human resource development; information and communications technology and energy security amongst others. The region is one of the least economically integrated in the world and that is why many member countries have become frustrated with the slow progress of SAARC and are looking for alternatives.
Apart from lack of trust, there are a number of constraining factors as well as other challenging issues in the SAARC framework. Some of these include: its inability to tackle inter-state conflicts that have often made it hostage to bilateral conflicts and the nationalistic interests of member countries and an India-centric strategic perception that exists both among India’s neighbours as well as among other countries. Moreover, SAARC follows the principle that all decisions have to be made unanimously and that no bilateral and contentious issue can be on the SAARC agenda. This clearly exhibits a weaker inter-state relationship toward equitable participation in policy making for South Asian people.
Apart from historical conflicts between member countries, there is also disagreement among them on the need for a South Asian conflict resolution mechanism to deal with bilateral disputes. India, Nepal and Sri Lanka are not in favour of conflict resolution mechanism as a domain of the SAARC.
At the same time many South Asian countries are not dependent on SAARC to achieve their economic objectives. They give priority to bilateral agreements because of their own self-interests instead of regional economic cooperation. Such a trend diminishes SAARC’s importance and future prospects to member countries. Despite these obstacles, SAARC can still play an important communicative role in South Asia. It can serve as a forum for South Asian leaders to discuss geo-economic issues for South Asia on a regular basis.
Deeper integration, in addition to the creation of a free trade area, entails liberalisation of services, investment, elimination of non-tariff barriers, and in general, going beyond traditional market access issues. There are overlapping trade agreements and unilateral policy announcements among member countries that undermine the regional agreement. There is need to focus on this factor which could facilitate trade and financial connectivity in South Asia. An aspect that has drawn relatively less attention but is of critical importance is the lack of financial connectivity in the region.
With a dominant economy and the largest country in the region, India should attempt to become the engine of economic development for the region. Greater Indian participation in SAARC activities is important to reduce two major suspicions: first, smaller countries want to use SAARC to gang up against India, and second, that their economy will suffer from Indian exports and marketing strategies.
Indian Prime Minister Narendra Modi invited all the heads of South Asian countries to his oath-taking ceremony on May 26, 2014 at New Delhi. The move can also be viewed as a strategic change in India’s geo-economic dependence on the cooperation and support of its neighbours. Thus, there is reason to be optimistic about the future of SAARC.
Therefore, the role of India is pivotal in encouraging the South Asian countries to come together to resolve the above issues along with food, water and energy security. India can effectively stimulate the working potential of organizations like SAARC Food Bank, SAARC Seed Bank, and SAARC Energy Centre.
Furthermore, elimination of intra-regional non-tariff trade barriers such as recognising the mutual standards and certifications is essential for sustainable economic development and greater cooperation in the region.
India should also increase aid and technical assistance, particularly through the Indian Technical & Economic Cooperation Programme (ITEC) and Line of Credit (LOC) to its member countries.
India should also increase cooperation in knowledge transfer, research and development with neighbouring countries. Joint research projects for agricultural development particularly in input can lead to reduction in food insecurity.
India can also transfer and share technologies which are essential for promoting economic growth through industrialization in the region. This will also make India to reduce carbon emission and represent India one step ahead with positive collaborative approach in the region.
This is the right time that India must actively work for a region-wide acceptance of the vision of a South Asian community based on peaceful coexistence, economic cooperation, religious tolerance and cultural understanding. In such a scenario, it would be useful for India to consider several unilateral measures that would push the concept of SAARC into a more realistic mould.
(Ram Kumar Jha and Saurabh Kumar are working as Policy Analyst, CUTS International and can be contacted at email@example.com)