Round The World

New Delhi, 15 November 2011

SAARC Summit

AURA OF ECONOMIC OPTIMISM

By Monish Tourangbam

Research Scholar, School of International Studies (JNU)

The recently-concluded SAARC Summit has essentially left an aura of optimism. The major focus has been economic development of the region. However, there are barriers which must be crossed. In the past SAARC summits have been known to be high on promises but low on delivery. The region is not short of human and material resources. But, bitter historical baggage among the member nations has created political hurdles that have highly depleted the potential of the region

India has always been seen as the ‘big brother’ out to control other smaller members of the association. Undeniably, it is a landmass connecting the association like a huge magnet, and the economic might that India has managed to create for itself, should be seen by other nations as an opportunity and not a whipping stick. Even a country like Pakistan, is going to create more economic vistas for itself by normalizing trade ties with New Delhi.  

An optimistic perspective of India’s growth and the positive changes that it can bring for the region is gradually emerging, but the results depend on implementation, and that is where the challenge lies. The XVIIth Summit at Addu Atoll, Maldives was convened on the spirit of ‘building bridges’ among the members. Now, the question arises: ‘Can economic integration pave a new way and connect the countries?’ The answer cannot be a simple yes or a no.

While economic integration is a vital process of building a sense of mutual partnership, there are lingering political and security issues. There are unresolved boundary issues, problems concerning illegal immigration, insecurity bred by cross-border terrorism, river systems and fisherman issues, etc making matters more complex in the region. There is an ethnic continuum cutting across the region, which ideally should produce areas of convergence but unfortunately has ended as irritants on several occasions.

Other countries have often accused India-Pakistan issues of overshadowing SAARC summits. And repeated concerns raised by these nations have definitely put some restrain and help enlarge the spectrum of debate in the forum.  

True to form, Prime Minister Manmohan Singh sought to emphasize the need for regional economic integration, in the light of the global meltdown.  Considering the sluggish recovery of the international economy, increasing Intra-SAARC trade, according to him, is important to beat the spillover effects of a squeeze on capital, investments and markets for exports.

As a confidence-building measure and trade liberalization effort, New Delhi has decided to reduce the Sensitive List for Least Developed Countries under the South Asian Free Trade Area Agreement from 480 to 25 tariff lines. Zero basic customs duty access would be given for all items removed with immediate effect. Besides, effective implementation of the South Asian Free Trade Area (SAFTA), early resolution of non-tariff barriers and expediting the process of harmonizing standards and customs procedures were other important declarations at the summit.

One of the major bottlenecks for intra-South Asian trade is the lack of proper transport networks. In fact, the very theme of the summit, ‘building bridges’ should exactly mean just that, i.e. increasing connectivity, proper institutionalization of mechanisms to handle trade traffic and to liberalize procedures. As such, declarations to expedite implementing the Regional Railways Agreement, the Motor Vehicles Agreement and the Indian Ocean Cargo and Passenger Ferry Service were significant. Moreover, conducting of an early demonstration run of a container train (Bangladesh-India-Nepal) was seen as a priority.

Chandrajit Banerjee, Director General of the Confederation of Indian Industry, captured the imperative of economic integration when he commented: “With one-fifth of the world’s population, the SAARC region is home to two-fifths of the world’s poor. However, it accounts for only 3 per cent of global output and 2 per cent of world exports. Intra-regional trade has stagnated at around 5 per cent of its total trade, compared to over 50 per cent in East Asia and around 20 per cent in Latin America. Even Sub-Saharan Africa, with poor transport and telecommunication infrastructure, scores over South Asia, with over 10 per cent of its trade being intra-regional.”

As mentioned earlier, India-Pakistan spats have been regularly accused of jeopardizing any forward movement in the SAARC region. As such, India-Pakistan sideline meetings and comments become the cynosure of all eyes and ears in these regional meets. But of late, various confidence building measures, such as Pakistan’s Most Favoured Nation Status to India, have been adopted by both sides to ease the tension, largely plaguing the relationship since the Mumbai attacks. Talks had completely stalled since then but New Delhi realized that exercising the ‘no talks’ policy against a nuclear-armed neighbour would pay no meaningful dividend. However, resuming talks alone is not the end of the road.

Even though Pakistani Interior Minister Rehman Malik called the sole surviving gunman of the 26/11 Mumbai attacks, Ajmal Kasab, a “terrorist” and demanded he be hanged, it is highly discernible that this will not solve the issue, unless Islamabad is willing to come clean on the higher echelons of the terror factory stationed in Pakistani soil.

Concerning the 26/11 trial, Pakistan has, reportedly, failed to provide voice samples of the accused, to hunt down the masterminds and the ISI link detailed by David Headley, and no action against Lashkar founder Hafiz Saeed and his Jamaat ud Dawa. On the Indian front, Singh faced a barrage of criticism for calling his Pakistani counterpart Gilani a “man of peace”.

New Delhi and Islamabad before the Adu Summit had also aired different positions on inducting more observers and enhancing the existing roles. India has had concerns that some countries in the association might want inclusion of more observers merely to offset India’s influence. But, the summit declaration managed to take a middle path.

The Declaration decided to strengthen the SAARC mechanisms, including the Secretariat and Regional Centres, through an inter-governmental process, thus catering to India's desire to stabilise the organisation's internal processes and institutions instead of adding more Observers. It also accommodated Pakistan's view by resolving to undertake a comprehensive review of all matters relating to the SAARC's engagement with Observers, including the question of dialogue partnership, before the next Session of the Council of Ministers in 2012.

Despite lingering differences and contentious issues, the environment does seem to be right for taking credible steps. As an editorial in Pakistan’s Daily Times commented, “On Pakistan’s side, the lobbies clamouring for continuation of isolationist policies need to be managed appropriately. The religious or rightist lobbies that would like the Indo-Pak bilateral relationship to remain in cold until the resolution of the Kashmir issue to their satisfaction would need to be edged towards the cold store themselves. Their strategies of the past have borne nothing but the bitterest of fruits. “

One can smell optimism in the air --an enthusiastic Maldivian President at the helm of affairs, all-weather India-Bhutan friendship, India’s improving ties with Sri Lanka and Bangladesh, and a new confidence in Indo-Pakistan ties, though guarded. As the saying goes, “Make hay while the sun shines,” the key lies in implementing the statements and decisions taken at the regional summit. The hope is that the biggest battles in the subcontinent will be fought on cricket pitches rather than on the borders.---INFA

(Copyright, India News and Feature Alliance)