BIISS JOURNAL, VOL. 25, NO. 4, OCTOBER 2004

M. Ali Rashid
A.K.M. Atiqur Rahman

IMPLEMENTING THE SOUTH ASIAN FREE TRADE AGREEMENT (SAFTA): CHALLENGES AND POSSIBLE ROADMAP


The members of the South Asian Association for Regional Cooperation (SAARC) established the SAARC Preferential Trading Arrangement (SAPTA) in December 1995. More recently, in January 2004 the SAARC member states signed the South Asian Free Trade Agreement (SAFTA) which will enter into force on January 1, 2006. Deeper economic integration is being pursued in South Asia to reap the benefits from enhanced levels of intra-regional trade and investment flows.
An analysis of the SAFTA Agreement reveals some major deficiencies which, if not rectified very quickly, may substantially reduce expected benefits from establishing a free trade area. These shortcomings of the Agreement have taken the form of a relatively slow tariff liberalization program; gray areas in provisions relating to non-tariff and para-tariff barriers; absence of negotiating modalities and deadlines with regard to concretizing rules of origin criteria; an apparent lack of consensus on issues of ‘sensitive lists’, revenue compensatory mechanism for LDC members, technical assistance for LDC members, and harmonization of legislation; and absence of provisions to deal with unfair trade practices and investment promotion.
A roadmap has been suggested for effective implementation of SAFTA. The policies suggested are: acceleration of the trade liberalization program, phasing out of non-tariff and para-tariff measures by a specified date, negotiation and incorporation of rules of origin criteria in the Agreement before it comes into force, negotiating the ‘sensitive lists’ in a WTO-consistent manner, designing an unambiguous revenue compensatory mechanism and ensuring technical assistance for LDC members, and incorporating provisions for dealing with unfair trade practices and promoting intra-regional investment.


M. Ali Rashid, Ph.D. and A.K.M. Atiqur Rahman, Ph.D. are respectively, Professor and Associate Professor of Economics, North South University. This is a revised version of a paper presented at the Regional Conference on The 12th SAARC Summit: Sustaining the Momentum for Regional Cooperation and Development in South Asia organised by the Bangladesh Institute of International and Strategic Studies (BIISS) and held in Dhaka on 13-14 July, 2004. Their e-mails addresses are: akmatiq@northsouth.edu marashid@northsouth.edu respectively

© Bangladesh Institute of International and Strategic Studies (BIISS), 2004



C. Raja Mohan

THE TWELFTH SUMMIT AND THE FUTURE OF SAARC


Abstract
Judging the achievements of SAARC in terms of its own past, it is easy to proclaim the Twelfth SAARC Summit at Islamabad in January 2004 a success. But when compared to progress on regional economic integration elsewhere in the world, the SAARC process must be assessed as too slow and very painful. The framework agreement on launching the South Asian Free Trade Area (SAFTA) concluded at Islamabad Summit is meagre in its scope and substance when seen in the light of the regional economic integration happening elsewhere in South Asia’s neighbourhood. Nonetheless, the Islamabad Summit of SAARC has laid the foundation for thinking more radically about the future of regionalism in South Asia. If it comes up with a bolder agenda of regional integration – not in terms of words, but actions – the Dhaka Summit of 2005 will signal that the political momentum acquired at Islamabad is real and the SAARC has finally turned a corner. Many opportunities beckon the region today. But the ability of SAARC to grasp them will depend upon some sustained hard work at the bureaucratic level and some political vision at the top.


C. Raja Mohan, Ph.D. is a Professor of South Asian Studies, School of International Studies (SIS), Jawaharlal Nehru University, New Delhi. An earlier version of the paper was presented at a Regional Conference on : The 12th SAARC Summit: Sustaining the Momentum for Regional Cooperation and Development in South Asia organized by Bangladesh Institute of International and Strategic Studies (BIISS), Dhaka on 13-14 July 2004 in Dhaka. His email: crmohan@vsnl.com

© Bangladesh Institute of International and Strategic Studies BIISS, 2004

 


O. P. Shah

INSTITUTIONAL CAPACITY BUILDING AND EXPANSION OF SAARC

Abstract
Over the years, SAARC activities have considerably increased and diversified. The new and emerging areas of SAARC cooperation necessitate a thorough review of the situation in order to enable the SAARC Secretariat to carry out its growing responsibility effectively. A balanced course of action is suggested by most, wherein necessary authority is extended to the Secretariat and a corresponding sense of responsibility is also ingrained in them. The creation of a Core Group consisting of immediate past chairs, current chair, the next chair and the Secretary General as an informal arrangement may also help in speedier implementation. There is a viewpoint that having Afghanistan into SAARC will open a new window of opportunity for SAARC’s resilience and further innovation towards additional avenues for sub-regional co-operation as well as engineering inter-regional co-operation.


Mr. O.P. Shah is Chairperson, Centre for Peace and Progress, Kolkata, India. The paper is a revised version of a presentation at a Regional Conference on The 12th SAARC Summit: Sustaining the Momentum for Regional Cooperation and Development in South Asia organized by BIISS on 12-13 July 2004 in Dhaka. Mr. Shah’s e-mail: opshah@cal3.vsnl.net.in

© Bangladesh Institute of International and Strategic Studies(BIISS), 2004

 


Prem Shankar Jha

STRENGTHENING COOPERATION IN THE SAARC REGION
Abstract
Inter-state relations in South Asia are characterized by tensions and acerbity, which in turn, lead to economic and social failures of different dimensions - rising unemployment, growing desperation among the youths and resulting political turmoils. The trend needs to be reversed immediately. The theme of the paper is that the right kind of economic cooperation even now could just about make the difference between viability and growth in a globalised world, and economic exclusion and spiralling descent towards state failure. One way to do this would be to create a Joint Infrastructure Development Authority under SAARC to which all the SAARC countries would provide seed capital in proportion to their size and GNP. This authority could be entrusted with the task of preparing feasibility reports for existing and proposed regional infrastructure projects, finding international investors, determining the share of each of the concerned countries in its share capital, the tariffs to be charged for the services or products supplied to the beneficiaries, and do whatever else is required to implement the project. A parallel organisation to be created by SAARC, could administer the infrastructure facilities so created, much as the original Common Market Secretariat in Brussels did in the sixties and seventies.


Mr. Prem Shankar Jha is Senior Columnist, The Hindu/Outlook, New Delhi. An earlier version of the paper was presented at a Regional Conference on : The 12th SAARC Summit: Sustaining the Momentum for Regional Cooperation and Development in South Asia organized by Bangladesh Institute of International and Strategic Studies(BIISS), Dhaka on 13-14 July 2004 in Dhaka. His e-mail: premjha@touchtelindia.net

© Bangladesh Institute of International and Strategic Studies (BIISS), 2004

 

Niaz A. Naik

SOCIO-CULTURAL VISION OF SAARC IN THE THIRD DECADE

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Abstract
SAARC has recently entered its third decade. On the eve of the third decade there are new imperatives in socio-cultural areas for combating social problems in the region. The Social Charter signed in the 12th SAARC Summit must be fully linked with the UN Millennium Development Goals (MDGs). Some major institutional reforms within SAARC are essential for attaining the socio-cultural development goals. Suggestion for a Summit Group comprising of the current, outgoing and the forthcoming chairs of SAARC to ensure implementation of the Summit decisions may be made in this context. Secondly, status, function and power of Secretary General should be raised to that of Minister and the position should have adequate flexibility to take initiatives aimed at enhancing regional cooperation and resource mobilisation for SAARC programmes. Thirdly, highly professional experts should be appointed in the Secretariat from within the region to give it a truly regional character and enhance its institutional capacity.


Mr. Niaz A. Naik is Former Foreign Secretary of Pakistan and a Member of the SAARC Group of Eminent Persons (GEP), constituted in the 9th SAARC Summit held in Male in 1999. An earlier version of the paper was presented at a Regional Seminar on Vision of SAARC in the Third Decade organized by Bangladesh Institute of International and Strategic Studies (BIISS) on 8-9 December 2004.

© Bangladesh Institute of International and Strategic Studies (BIISS), 2004

 

Mohammed Mohsin

VISION OF SAARC IN ITS THIRD DECADE – A PERSPECTIVE
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Abstract
While the process of regional cooperation within the framework of SAARC has been admittedly slow and halting, the holding of SAARC summits, other Ministerial and official meetings are indeed positive indications for SAARC. In this context, the 12th SAARC Summit made some landmark achievements. In order that the cooperation processes sustain the momentum, a number of measures are suggested in the paper. The first suggestion is to strengthen SAARC Secretariat and raise the status of the Secretary General to ministerial rank. A second suggestion is to expedite the proposed investment agreement to precede SAFTA, and initiate some joint high profile projects to make impact on the development process. Thirdly, concerning financial resources for the SAARC Secretariat, the Member States may consider deciding upon some arrangements for regular funding. For this purpose, again the well established practice followed by the European Union is worth studying by the SAARC members. Perhaps SAARC, which is also driven by political and economic considerations, has something to emulate from the European experience and instead of other regional integration initiatives/experiences which are mainly powered and driven by the interests of global multinational companies, etc.

Mr. Mohammed Mohsin, is a Former Foreign Secretary of Bangladesh and a Member of the SAARC Group of Eminent Persons (GEP) constituted in the 9th SAARC Summit held in Male in 1999. An earlier version of the paper was presented at a Regional Seminar on Vision of SAARC in the Third Decade organized by Bangladesh Institute of International and Strategic Studies (BIISS) on 8-9 December 2004. His e-mail: mohsinm@agni.com

© Bangladesh Institute of International and Strategic Studies (BIISS), 2004

 

Mohammad Omair Saqib

PEOPLE TO PEOPLE CONTACTS IN SAARC

Abstract
In this era, when the world is being viewed as a global village, there is more and more need of constructive dialogue among the countries of the South Asian region to create greater cooperation and understanding under the auspices of SAARC. The need to exercise collective will of people and leadership and the emphasis on people-to-people contacts have become more and more imperative for fostering friendship and promoting natural understanding among the states of South Asia. Introducing a visa-free regime, facilitating intra-regional tourism, improving communication infrastructure and transport, developing effective telecommunication network, cooperating in the education sector and exchange of sports and culture would contribute significantly in promoting people-to-people contacts in this region. SAARC is often viewed as an organization, which facilitates the meeting of the Government officials, policy makers, political leaders and experts. The regional members have somewhat failed in bringing SAARC closer to the people of the region, but the impoverished, downtrodden, marginalized people of the region also need to take interest in the organization, strengthening it and exert pressure upon their Governments to initiate more far-reaching and radical steps to make the SAARC more useful and beneficial for the people and develop SAARC into a truly people’s SAARC.


Mr. Mohammad Omair Saquib is an Assistant Editor, The Dawn, Karachi. An earlier version of the paper was presented at a Regional Conference on : The 12th SAARC Summit: Sustaining the Momentum for Regional Cooperation and Development in South Asia organized by Bangladesh Institute of International and Strategic Studies(BIISS), Dhaka on 13-14 July 2004 in Dhaka. His e-mail: omair_saqib@hotmail.com.

© Bangladesh Institute of International and Strategic Studies (BIISS), 2004