The Financial Express
Published Date: Oct 14, 2016
South Asia Economic Summit: Thinking out of the box
The Ninth South Asia Economic Summit is being organised in Dhaka at a time when the 19th SAARC (South Asian Association for Regional Cooperation) summit, scheduled to be held in Islamabad on November 9-10, has been postponed.
Thus, the holding of the two-day Ninth South Asia Economic Summit (SAES), which begins in Dhaka today (October 15), has become a challenging job for the organisers, especially the civil society organisations of the region.
A CIVIL SOCIETY INITIATIVE: Civil society organisations in South Asia are always very active in extending cooperation across the region. That’s why ‘Track II’ initiative, non-government and unofficial and informal diplomacy, is more advanced than ‘Track I’ initiative or official diplomatic engagement in the region.
First SAES was held in Sri Lanka in 2008 which was organised by Institute of Policy Studies of Sri Lanka (IPS) and the Federation of Chambers of Commerce and Industry in Sri Lanka (FCCISL) in collaboration with a number of institutes in the region: Research and Information System for Developing Countries (RIS), India; South Asia Centre for Policy Studies (SACEPS), Nepal; and South Asia Watch on Trade, Economics & Environment (SAWTEE), Nepal.
Since then, the SAES has been organised annually. Dhaka first hosted the summit in 2011. The Centre for Policy Dialogue (CPD), a leading think-tank in the country, is organising the current event on 15-16 October, 2016. Co-organisers of the event are RIS, India; SAWTEE, Nepal; Sustainable Development Policy Institute (SDPI), Pakistan; and IPS, Sri Lanka.
The broader theme of the current SAES is ‘Reimagining South Asia in 2030.’ As the Agenda 2030 or Sustainable Development Goals (SDGs) will guide the global development path in the next 15 years, South Asia can’t go beyond this global agenda agreed by the world leaders last year. Moreover, September this year marked the first anniversary of accepting the SDGs in the United Nations (UN). So, it is right time to focus on SDGs in the regional context. The concept note of the summit also says: "Ninth Summit will focus on a set of cross-cutting issues and a cluster of thematic issues that would deliberate on envisioning the South Asia in 2030."
LOOKINF BEYOND TRADE: Intra-regional trade in South Asia is considered as an important indicator of progress on regional cooperation under SAARC framework. SAARC intra-regional trade, on average, is stagnant at 5.0 per cent of its global trade. Value of intra-regional trade in South Asia declined to $46.51 billion in 2015 from $49.57 billion in 2014 (see graph).
Member countries of SAARC are agreed to implement the South Asian Free Trade Area (SAFTA) by eliminating tariff barriers by 2016. They also agreed to establish a customs union and then an economic union in the region. But, in reality, they are unable to fulfil their commitment on establishing the free trade area within the stipulated time let alone move towards a customs union.
As greater economic cooperation and regional integration require move beyond trade and countries of the region have already adopted several initiatives to extend the horizon. Dr Prabir De, a professor at Delhi-based RIS, thinks that SAARC has to move from FTA-based integration arrangement to a comprehensive arrangement. In an interview with Thinking Aloud, a monthly news bulletin of South Asian Network on Economic Modelling (SANEM), the Indian economist said that such comprehensive arrangement would be beneficial for the member countries in non-economic areas, particularly cultural and political issues. "FTAs are the case of the past. Comprehensive cooperation is the new trend among developing countries," he added.
But what about the sub-regional grouping when SAARC itself becomes uncertain? Dr Selim Raihan, a professor of economics in the Dhaka University, also SANEM chairman, believes that sub-regional cooperation could be an answer to the deadlock of the regional integration in South Asia. In an article, published in the Thinking Aloud this month, he mentioned that in order to take forward the regional integration process in South Asia "a good and effective initiative is the Bangladesh, Bhutan, India, Nepal (BBIN) initiative, which is a sub-regional coordinative architecture of countries in South Asia."
Not that sub-regional arrangement has all the tools ready to make the regional integration deeper and successful. It is the smaller size that matters to resolve critical issues quickly. The experiences help to deal with the difficulty in the greater regional integration process.
Both the economists, however, termed the India-Pakistan rivalry and consecutive political tensions as ‘sole factor slowing down the SAARC integration process.’
Nevertheless, it is in no way a wise move to abandon the effort of regional integration under SAARC framework. Dr Prabhash Ranjan, an assistant professor at the South Asian University in New Delhi, argues that India and Pakistan shouldn’t weaken their trade ties. In a recent article in The Hindu, he said: "Empirically, it has been shown that higher levels of free trade reduce military conflicts. India and Pakistan should boost free trade amongst themselves, Pakistan should honour its MFN commitment to India in the WTO, and India should use the SAARC platform to push for deeper trade ties."
DECODING INTEGRATION: Voluminous research and analytical papers and articles have already been written on the cost and benefit of the regional integration in South Asia. So, decoding the integration and cooperation is important to avoid complexities in the region. To put it simply, regional integration is a process where people and products of the SAARC countries can move freely across the region for socialisation and livelihood. There will be no unnecessary restriction for travelling. Exchange of knowledge, information and cultural activities will be free. The policymakers and politicians of the region will work in such a coordinated and combined manner so that poverty and hunger of the millions of people can be eliminated. As SDGs’ ultimate goals are to end poverty and hunger of the people, protect the planet from degradation, ensure prosperity for all human beings, foster peaceful, just and inclusive societies and strengthen the global partnership, a deeper integration of South Asia is very much linked with these goals.
Achieving the SDGs in South Asia is a daunting task and requires extended regional cooperation. When, two major countries – India and Pakistan – are in an arms race, they are diverting their resources on poverty reduction and balanced development. SDGs bring a new opportunity to reduce the arms race and geo-political tension across the region.
In fact, think tanks involved in SAES initiatives have actively contributed to the formation process of SDGs through Southern Voices initiative of CPD. They are now working on implementation and monitoring the global agenda. Series of policy-oriented research have been undertaken and dissemination of the findings to the policymakers and stakeholders are going on.
The current economic summit would focus on "envisioning a South Asia which by 2030 will be an upper middle-income region with high GDP growth rate, a strong middle class, zero hardcore poverty and hunger, sustainable cities, structurally transformed economies with strong manufacturing sector." The organisers also believe that business as usual would not do, and pathways dictated by past trends are unlikely to work. They, thus, stressed on thinking out of the box if the South Asian countries’ ‘future is to be shaped in accordance with the high ambitions set out in the SDGs.’
So, the South Asia Economic Summit is a reflection of continuous and tireless effort to improve the future of the region and its people. Despite lot of disappointments and slowdown in regional cooperation, the SAES summit kindles a hope of reviving the comprehensive effort by the regional leaders to advance the cooperation among the countries.