(The SAARC Charter Day is being observed today to mark the establishment of the regional association).The group of seven countries: Pakistan, Bangladesh, Bhutan, India, the Maldives, Nepal and Sri Lanka in their first-ever summit on December 8, 1985, adopted the charter establishing the South Asian Association for Regional Co-operation (SAARC) for holding out the promise of a new era of understanding and co-operation among the member countries to promote the well-being of their people, improve their standard of living, speed up the economic growth, social progress and cultural development; reinforce links between the countries of the region, and promote mutual collaboration and assistance in the economic, social, cultural, technical and scientific fields within the framework of Integrated Programme of Action (IPA) in several areas.
SAARC in the last 19 years has achieved significant progress in many areas. However, in areas of poverty and social progress concerted efforts are needed to reduce the burden of poverty and social gap. The region has emerged by now as one of the poorest, most illiterate, malnourished and the least gender-sensitive regions in the world.
Out of a total population of 1.4 billion, around 530 million or nearly 40 percent people are in the category of absolute poor. The region represents almost 23 percent of the world population, but share only 2 percent of world GNP ($540 billion in 2002). Average per capita income is $450, compared to world average of $5080.
The total external trade of the region amounts to less than one percent of the world exports and 1.3 percent of world imports. Intra-regional exchanges represent only 4 percent of regional trade - 5.3 percent (exports) and 8 percent imports.
The new millennium has witnessed a fast push towards integration. Information technology and capital have gained phenomenal mobility. Regions are organising collective groupings to maximise gains.
The regions, which integrate better from within, also do much batter with the rest of the world.
The successful completion of Uruguay Round of GATT and the establishment of WTO to facilitate world trade system is a trend towards globalisation of world economy. Simultaneously, in the last 20 years, regional trade blocs also got momentum as an attempt to operate in the global market with increased economic strength.
EU has 70 percent intra-regional trade, whereas other trade blocs, such as ASEAN, NAFTA and Apec have an average of 50 percent international trade. SAARC countries as a bloc need to make more efforts to strengthen and push forward the SAARC process to enhance the level of bilateral trade and strengthen trade and commercial relations between member countries to get maximum benefit from the changing environment.
It is imperative that a cohesive and economically integrated South Asia would be better positioned to negotiate globally for advantageous terms of trade with WTO regime and development institutions.
The operationalisation of SAARC Preferential Trading Arrangement (SAPTA) was the first step towards liberalisation and creation of SAARC trade bloc and transition to a South Asian Free Trade Area (SAFTA) leading subsequently, towards a Customs Union, Common Market and Economic Union.
Since SAPTA upto the 12th SAARC Summit in January 2004 significant progress has been achieved to strengthen regional position in the world trade. The member countries' commitment to move in South Asian Free Trade Area (SAFTA) by eliminating all tariff and non-tariff barriers by 2005 is seen as a positive initiative to strengthen the process further.
In recent years, there has been a considerable recognition that friendly relations with neighbouring countries can help in developing supportive environment to compete and fully integrate itself to benefit from the opportunities created by the globalisation process.
The last 12th SAARC Summit, January 2004 in Islamabad was successful in bringing the emerging problems into focus. The SAARC member countries commitment to SAARC Social Charter and SAFTA in particular will help achieve objectives of SAARC Charter.
Pakistan's Prime Minister Shaukat Aziz recent visit to six SAARC member countries further invigorated SAARC activities by focusing on economic integration and stressing on intra and extra SAARC trade.
The collective efforts of member States within the framework of SAARC Social Charter and the development of SAARC Development Goals (SDGs) and SAARC Poverty Fund (SPF) would help reduce poverty and bridge social gaps and vulnerability and would effectively deal with the phenomenon of globalisation in South Asia. The bonhomie created by the 12th Summit is expected to further boost regional co-operation with the 13th SAARC Summit in Bangladesh in January next year.
In conclusion, South Asia must emerge as an economic potential for one-quarter of humanity. SAARC must evolve a cohesive and sound agenda to reinforce the individual efforts of each member country.
SAARC, as an important organisation with enormous potential, needs to focus on an integrated and multi-pronged approach to achieve the SAARC Charter objectives by forging a common strategy to safeguard regional interest by integration of available capital, indigenous capabilities and technologies.
Interaction of professionals, intellectuals, scientists and trade and industry circles and policy-makers of the region would strengthen this process.
(The writer is Director of SAARC Human Resource Development Centre, Islamabad.)
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