According to a FICCI knowledge paper on BIMSTEC which was released recently, trade and investment should be the focus of the organization, where member states could negotiate a comprehensive free trade agreement, introduce trade facilitation steps, harmonize their national technical means, reinvigorate connectivity and strengthen energy linkages, writes Anil Wadhwa for South Asia Monitor
By Anil Wadhwa
The Bay of Bengal Initiative for Multi Sectoral Technical and Economic Cooperation (BIMSTEC) is an organization that brings together Bangladesh, India, Sri Lanka, Thailand, Myanmar, Bhutan and Nepal. Representing a bridge between South and Southeast Asia, its essential aim is to bring about economic growth and social progress in this sub region through a series of cooperative actions which enhance the potential of the countries by mitigating the effects of globalization, and by utilizing regional resources and geographical advantages. A permanent secretariat for the organization has been functional in Dhaka since August 2014.
Unlike other organizations, BIMSTEC is sector driven: Starting with the six sectors of trade and investment, technology, energy, transport and communication, tourism, and fisheries in 1997 – it added nine more sectors – agriculture, public health, poverty alleviation, counter terrorism and transnational crime, environment and disaster management, cultural cooperation, people to people contact and climate change by 2008.
It is now seen as an alternative to SAARC, which is in a logjam due to Pakistani intransigence. It is time, therefore, for India as the major contributor to the organization to pay attention to its reinvigoration and help it overcome lack of adequate political trust, availability of financial resources and involvement of business and civil society.
According to a FICCI knowledge paper on BIMSTEC which was released recently, trade and investment should be the focus of the organization, where member states could negotiate a comprehensive free trade agreement, introduce trade facilitation steps, harmonize their national technical means, reinvigorate connectivity and strengthen energy linkages. Strengthening regional value chains by linking South and Southeast Asia and setting up industrial parks will ease investments for countries of the region.
India is the lead country in the grouping for transport and communication. Sea-borne trade and coastal shipping between the countries of the organization has to be made viable; the Northeast of India developed and connected within and with rest of the region; multimodal transport models made prevalent, and coastal and border economic zones developed. India must complete the physical connectivity projects it has undertaken like the trilateral highway connecting India to Thailand via Myanmar and the Kaladan Multimodal Project connecting states of Northeast India with Myanmar at the earliest.
Developing closer links of the Indian Northeast to countries of relevance to India’s Act East Policy will be facilitated through BIMSTEC. The FICCI knowledge study also recommends developing short sea shipping, a BIMSTEC motor vehicles agreement, negotiating a regional coastal shipping agreement, improving air connectivity, and, more ambitiously, designing a connectivity master plan. It has also recommended cross-border energy trade, a BIMSTEC energy grid and regional renewable energy cooperation, given the hydropower potential of the region, and the presence of gas and petroleum in the countries like Myanmar and Bangladesh.
Strengthening the medical and Buddhist tourism connect, improving people to people connections through education and border community zones, making connections through media, cultural art forms (where India has the advantage of a natural connect) and cinema need to be encouraged.
The FICCI knowledge paper identifies the Bay of Bengal area as being richly endowed with resources such as oil and gas, other mineral resources and marine resources like fish thus presenting opportunities in the development of blue economy, and urges that attention be paid to fostering mountain economy of member countries like Bhutan.
According to the Indian Navy’s Maritime Security Strategy document, the littoral states of Bay of Bengal have large exclusive economic zones and comparatively weaker naval capabilities for their protection. BIMSTEC could be used as a platform to increase maritime domain awareness.
As the Chinese footprint in the Indian Ocean grows, India needs to come up with its own alternate development strategies in the region. The issue of shortage of funds for infrastructure could be met by involving financial institutions such as the ADB and countries like Japan, with transparent initiatives and low-interest lending (as opposed to Chinese investments which have lead to “debt traps” for many recipient states) in the BIMSTEC development plans. Japan has a shortage of labour while the BIMSTEC region has a young and growing population.
The BIMSTEC transport, infrastructure and logistics study (BTILS) conducted in the mid 2000s, and funded by Asian Development Bank (ADB), identified 160 projects to boost connectivity, of which 65 were prioritized. The Trilateral Highway, the Kaladan Multimodal Project and the Bangladesh, Bhutan, India and Nepal (BBIN) Motor Vehicles Agreement are the flagships. All of these are close to realisation although last-mile challenges remain. Continued dialogues like the BIMSTEC-BRICS dialogue held in 2016 will also help.
On balance, the thrust areas for BIMSTEC must be completion of flagship connectivity projects, boosting trade, tourism and investment and energy synchronization and cooperation.
(The author is a former Secretary, India’s Ministry of External Affairs and a former Ambassador to Thailand. He can contacted at firstname.lastname@example.org)