Regional Integration: Bimstec is the way
South Asia is the third largest economy in terms of GDP on the basis of purchasing power parity after the US and China. It hosts 21% of the world’s...
Integration of South Asia has become a dream for some sceptics after the last SAARC summit at Kathmandu. They believe that SAARC’s march towards a common customs union and an economic union would continue to remain a distant possibility for times to come. The SAARC Free Trade Area (SAFTA) already in operation has not met with much success as the official intra-regional trade remains around $22 billion a year, though trade through unofficial channels continue unabated. If the figure of unofficial trade is added up to the official, the total may be around $60 billion. This shows the potentiality of the region.
South Asia is the third largest economy in terms of GDP on the basis of purchasing power parity after the US and China. It hosts 21% of the world’s population on 3% of the global land mass.
However, the deeper integration of South Asia is being held hostage on account of political difference between the two major powers in the region – India and Pakistan. Very often there are skirmishes at the border. Some feel that unless and until the differences between the two nations are fully resolved, integration of South Asia would remain a distant dream. Though the trade relations between both have improved in the recent years with Pakistan commerce ministry moving from positive to negative list for imports to facilitate entry of more Indian goods, still much needs to be desired.
Over a decade back India had accorded the most favoured nation (MFN) status to Pakistan in matters of trade, but the latter has yet to reciprocate. Islamabad is thinking of giving non-discriminatory market access (NDMA) to Indian goods and at the same time is yet to allow these goods to pass through its territory to reach Afghanistan.
The outcome of the last 18th SAARC Summit at Kathmandu has strengthened the belief of the sceptics. The leaders were slated to sign three agreements, namely on motor vehicle cooperation, railway connectivity and cooperation in electricity trade. None of these was signed at the Summit venue. However, the agreement on electricity cooperation was signed with the intervention of the host, Nepalese Prime Minister Sushil Koirala at the Retreat of Leaders at Dhulikhel. The signing of the two other agreements is slated to be resolved at the ministerial level.
The big question is, for how long will the South Asia integration be held to hostage? Is there a way out? Yes. India which is a major country in the region shares borders with all countries with the exception of Afghanistan, which shares its borders with Pakistan. Hence, New Delhi should play a more proactive role in deeper integration of South Asia and work out the plans with all the countries that share the same borders. Regarding, integration with Afghanistan, India should explore the possibility of using Chabahar port in Iran to reach goods and services to Afghanistan by rail and land route. Rightly this possibility is being explored.
Besides, focus should be given to the sub-regional grouping already in existence – the Bay of Bengal Initiative for Multi-Sectoral and Technical and Economic Cooperation (BIMSTEC) which has within its fold five of the eight SAARC countries, excluding Maldives, Pakistan and Afghanistan. BIMSTEC also includes two countries of ASEAN bloc, namely Thailand and Myanmar. Therefore, if it is reactivated in real spirit, it can serve as an effective bridge between South Asia and South East Asia. It would also be better to offer BIMSTEC membership to Maldives, even though it is situated in the Arabian Sea and not in the Bay of Bengal. Being a SAARC country it can play a positive role in BIMSTEC by strengthening South Asia’s integration with ASEAN.
BIMSTEC is much younger to SAARC which is around 30 years old. Though not much focus has been given to it, the sub-regional group has some definite positive achievements to its credit. It includes SAARC countries like Bangladesh, Bhutan, Indian, Nepal, Sri Lanka and ASEAN countries like Myanmar and Thailand. It brings together 1.5 billion people amounting to 21% of the world population and a combined GDP of $2.5 trillion.
But unfortunately, BIMSTEC so far has had only three Summit-level meetings since its formation in June 1997 in Bangkok. Only recently it had got its secretariat which is rightly situated in Bangladesh. The present leadership in Dhaka under Shiekh Hasina is very proactive in fostering regional integration not only in SAARC but also in BIMSTEC. The last BIMSTEC Summit was in Nay Pyi Taw in Myanmar last year and the next is scheduled to be hosted in Nepal.
BIMSTEC has identified 14 priority areas where a member country takes the lead. India is the lead country for transport and communication, tourism, environment and disaster management and counter-terrorism and transnational crime, Bangladesh for trade and investment and has circulated a concept paper on climate change. Bhutan is the lead country for cultural cooperation, Myanmar for energy and agriculture cooperation and Nepal has taken up the issue of cooperation in poverty alleviation. Sri Lanka is the lead country for technology cooperation and Thailand is for cooperation in fishery, public health and people-to-people contact.
The BIMSTEC Transport Infrastructure and Logistics Study (BTILS) has identified as many as 100 projects that would promote connectivity within the region. These projects are to be funded by the Asian Development Bank. Apart from these, there are the Kaladan Multi-Modal Project that would connect India to ASEAN countries and the India-Myanmar-Thailand Trilateral Highway, both of which are expected to be completed by 2016. There is also the ESCAP dream project of Asian Highway.
A new democratic government is likely to be in place in Myanmar, this year which may prove beneficial for regional cooperation. Further, as Shiekh Hasina is determined to ensure regional cooperation, the Myanmar-Bangladesh-India gas pipeline can be a reality. New Delhi also needs to do a bit for Dhaka in matters of sharing waters of river Teesta and effecting the land boundary agreement. India by striking electricity generation and sharing agreements with Nepal and Bhutan other than initiating sub-regional Mekong-Ganga Cooperation that includes Myanmar, Thailand, Cambodia, Laos and Vietnam has set an outstanding example.
To foster faster and deeper integration in South Asia, BIMSTEC is the way. Efforts should be made to include Maldives and that India integrates with Afghanistan through Iran. If this happens, Pakistan will be compelled to play its positive role ultimately. Sooner, the better.
By: Ashok B Sharma