Deepening Economic Cooperation in South Asia: Expectations from the 18th SAARC Summit

South Asia Watch on Trade Economics and Environment (SAWTEE), in collaboration with the German Agency for International Cooperation (GIZ), Federation of Nepalese Chamber of Commerce and Industry (FNCCI), CUTS International and Indian Council for Research on International Economic Relations (ICRIER), organized a two day regional consultation on “Deepening Economic Cooperation in South Asia: Expectations from the 18th SAARC Summit” in Kathmandu on 23 and 24 November 2014. The regional consultation was organized on the sidelines of the 18th SAARC Summit. The major objective of the consultation was to discuss issues important for South Asia in the area of regional trade, investment and energy cooperation, among others, and provide recommendations on the way forward. The programme was attended by about 81 participants representing academics, research, government, private sector and media.

The chief guest for the inaugural session Hon. Mr. Mahendra Bahadur Pandey, Minister for Foreign Affairs, Government of Nepal, stated that through the effective implementation of the South Asian Association for Regional Cooperation (SAARC) Agreement on Trade in Services (SATIS), SAARC could see higher growth in the services sector. He also expressed hope that SAARC would undertake necessary steps to promote intra-regional investments and attract foreign direct investments (FDIs). Speaking as the chair, Dr. Posh Raj Pandey, Executive Chairman, SAWTEE, stressed the need for SAARC to have political will and sincere commitments at the highest level to move forward.

The remaining part of the programme was divided into six technical sessions. In the first technical session on improving trade and transport facilitation and transit among South Asian countries, Dr. Prabir De, Senior Fellow and Professor Research and Information System for Developing Countries (RIS) gave a presentation where he highlighted the importance of simplification and harmonization of trade procedures particularly in the border areas; and the introduction of modern corridor management techniques in select corridors. Likewise, speaking as a discussant, Dr. Pushpa Raj Rajkarnikar, Chairman, Institute for Policy Research and Development (IPRD), recommended the adoption of new technologies by customs agencies along with transparent regulations and procedures, laboratory testing and accreditation. The participants suggested the importance of setting up a SAARC single window at customs and effective coordination among government officials on both sides of the border.

The second technical session on promoting trade through reducing non-tariff barriers in South Asia, started out with the launch of a report “Non-Tariff Measures (NTMs) in South Asia: Assessment and Analysis” prepared by the SAARC-Trade Promotion Network (SAARC-TPN). In this session Dr. Selim Raihan, Professor, University of Dhaka, made a presentation with emphasis on the need for harmonization of Technical Barriers to Trade (TBT) and Sanitary and Phytosanitary (SPS) measures, Mutual Recognition Agreements (MRAs) to reduce trade-impeding effects of NTMs/Non-Tariff Barriers (NTBs) and setting up benchmark of NTMs for priority products. Speaking as a discussant, Mr. Shankar Prasad Poudel, Under Secretary, Ministry of Commerce and Supplies, Government of Nepal, suggested the need for recognition of accredited private labs in Nepal by the Indian government. The participants also suggested on improving the coordination between cross-border agencies along with monitoring the progress made by SAARC countries in reducing NTBs.

In the third technical session on trade, gender and technology transfer in the South Asian context, Ms. Pramila Acharya Rijal, President, South Asian Women Development Forum (SAWDF), made a presentation where she underlined the need to raise and debate trade and gender issues in the public sphere and to learn from successful policies implemented in the neighbouring countries of South Asia. Speaking as a chair, Dr. Hiramani Ghimire, Executive Director, SAWTEE stressed the need for a comprehensive gender policy that can increase women’s participation in economic activities in South Asian countries.

In the fourth technical session on normalizing India-Pakistan trade for enhanced regional co-operation in South Asia, Dr. Nisha Taneja, Professor, Indian Council for Research on International Economic Relations (ICREAR), speaking as a moderator, started with the fact that despite historical trade links between the two countries, their bilateral trade is dismal. Considering the enormous volume of indirect and illegal trade between India and Pakistan, Mr. Zubair Ahmed, Former President, Federation of Pakistan Chambers of Commerce and Industry (FPCCI) stated that Pakistani consumers can make significant gains from the formalization of bilateral trade with India. The panellists also stressed the need to facilitate people-to-people connectivity, opening up more land routes between India and Pakistan and the possibilities of joint venture projects between the two countries.

The fifth technical session on promoting intra-regional investment and technology transfer in South Asia started out with a presentation by Dr. Vaqar Ahmed, Deputy Executive Director, Sustainable Development Policy Institute (SDPI) where he highlighted the importance of harmonization of national-level competition policies for cross border investment and working towards deepening of current free trade agreements in the region by including investment and technology clauses. Likewise, Dr. Hemanta Kumar Dabadi, Director General, Federation of Nepalese Chambers of Commerce and Industry (FNCCI) suggested the creation of a joint working group of public and private sector representatives to develop a regional value chain in SAARC region. During the session, participants stressed the need for greater investment ties between the countries of the region.

Presenting on the last technical session on ensuring energy security in South Asia through greater regional cooperation, Mr. Udai Singh Mehta, Director, CUTS International emphasized the need for effective institutions for large scale energy trade in the region. He also stressed the need for market oriented reforms of domestic power sectors to achieve long term regional cooperation in the sector. The panellists and the participants also suggested that a regional cooperation on energy in South Asia should also take into consideration renewables such as solar energy and hydro.

Stressing on the problems of poor connectivity and NTBs, speaking as the chief guest of the closing session, Hon. Dr. Swarnim Wagle, Member, National Planning Commission, Government of Nepal mentioned that it is cheaper for South Asian countries to export to any other region in the world than in South Asia. Moreover, he expressed SAARC commitments as far-fetched and suggested on implementing South Asian Free Trade Area (SAFTA) properly as an immediate goal. Mr. Suraj Vaidya. Senior Vice President, SARC Chamber of Commerce and Industry concluded the session by emphasizing the need to make use of SAARC in international negotiations for South Asia. He also underlined the importance of having a committee that can ensure implementing and monitoring of the SAARC declarations.

Programme Agenda

List of Participants

Presentations:

Improving Trade and Transport Facilitation and Transit in South Asia

Promoting Trade Through Reducing Non-Tariff Barriers in South Asia

Trade, Gender and Technology Transfer in The South Asian Context

Promoting Intra-regional Investment & Technology Transfer in South Asia

Regional Cooperation for Energy Security in South Asia

Media Coverage:

Republica 24 November 2014

The Himalayan Times 24 November 2014

E-kantipur 24 November 2014