• TOPICS
KATHMANDU, JUNE 23
Due to conflict among the South Asian countries, the desire for the states of the region to trade with one another has been limited.
SAARC's expectation that the establishment of a South Asian Free Trade Area (SAFTA) in 2006 would stimulate trade in the region did not materialise.
Even if SAFTA had been implemented by 2015, its success would have depended on the resolution of conflicts between the South Asian states – something that seems unlikely even in the future.
Judging from the experience of ASEAN, which has been relatively successful in enhancing economic coordination among its members, wishing to create a free trade zone in south Asia could be difficult.
While arguing against SAARC's ineffectiveness, individual countries within SAARC have used bilateral agreements to advance their economic interests.
For instance, Pakistan and other South Asian countries, except India, have maintained relatively beneficial trade relations with each other.
The existence of these bilateral agreements in the SAARC region is significant for three reasons. First, they show that states are not dependent on the regional body to achieve their economic objectives. Therefore, SAARC's importance in the future will likely diminish. Second, a focus on bilateral negotiations shifts attention away from the region. In the future, states are more likely to pursue bilateral agreements where they have to negotiate with only one country instead of seeking regional deals involving eight countries.
Third, the growth in bilateral trade agreements between South Asian countries highlights the priority states are giving to their own self-interests at the expense regional economic cooperation. So, if SAARC has not met the economic needs of its states, does it have a role in the future of South Asia? SAARC does face serious problems, from a resource crisis to being unable to facilitate regional cooperation. Still, SAARC can play a communicative role in South Asia. It can serve as a forum for South Asian leaders to discuss economic concerns on a regular basis and as an outlet for the SAARC countries to communicate with other regional economic blocks. While SAARC cannot force its member states to trade with one another, it can make them interact.
Informal talks held from time to time between the heads of state or government of the region at the SAARC summits helped diffuse tension between countries. While the dialogue has yet to produce tangible results, experience shows that SAARC can help promote political cooperation among the South Asian leaders. This could aid in efforts to improve economic integration in the future.
A version of this article appears in the print on June 24 2021, of The Himalayan Times.
