Initiatives Should Be Taken to Facilitate South Asian Economic Integration

Abstract

Last month I was in Singapore to join an international seminar on 'Pan Asian Integration' but before that we must be integrated in South Asia to facilitate integration with East Asia. The South Asian Association for Regional Cooperation (SAARC) is mandated for poverty alleviation through trade and economic cooperation in the region. It did not gain momentum up to the desired level. Intra-SAARC trade remained lower than 5% even after 23 years of SAARC's inception. The foreign direct investment (FDI) among the SAARC region is very negligible. Intra-regional investment depends on the capability to pursue deep integration and economic connectivity.

Our previous efforts to boost intra-regional trade through South Asian Preferential Trade Arrangement (SAPTA) did not meet with success because of some factors like intercountry barriers to trade, rampant informal trade, high tariff, non-tariff barriers, absence of harmonisation of standards, non-simplification of customs clearance procedures, non-simplification of banking procedures, barriers to intra-SAARC investment and inadequate transport infrastructure.

Effective trade facilitation measures should be implemented as an obligation to ensure enabling trade policy and governance for smooth and speedy movement of goods across the borders.

Keywords: South Asia, Economic Integration