Despite potential benefits, South Asian economies remain the least integrated, with trade stagnating at around 5.76% of the regions total trade when even Sub-Saharan Africa, with poor transport and telecommunication infrastructure scored over South Asia, with over 10% of its trade being intra-regional, he said. There was minimal FDI among Saarc members due to regulatory issues and non-facilitative business environment and even intra-region travel and tourism was also below desired levels, Ansari pointed out. An attitude of neglect or immobility to our immediate neighbourhood will not enhance our capacity and may deny us options, the VP warned.
This paradox of prospering regionalism in most parts of the world and its miniscule presence in South Asia needed to be addressed, Ansari said and called for a joint and cooperative effort to deal with the common challenges as this was the logical way ahead for South Asia. Indias large and growing economy offers the region a profitable destination for its exports and a competitive source for its imports, investments and technology, he said.
Ansari was speaking on Global Regionalism and Regional Inertia in South Asia at the inauguration of the International Relations Conference on India and Development Partnerships in Asia and Africa: Towards a New Paradigm organised by the Symbiosis Institute of International Studies of the Symbiosis International University and supported by the Public Diplomacy Division of the ministry of external affairs, in Pune.
Ansari said analysts are attributing reasons for immobility and low levels of intra-regional trade to disparity in size between India and its neighbours with India accounting for four-fifth of the regional GDP by value, weak port and transport infrastructure, difficult business environment, apprehension of being swamped by Indian business interests and resultant damage to local industries. This has led to persistence of high levels of overall protection, restrictive rules of origin and destination, lack of coverage and commitment in the merchandise trade agreement and persistence of negative list category as an impediment to free trade.
Despite these, the questions in the final analysis boils down to political will, or a lack of it, to further regional cooperation. Some scholars, familiar with the subject, have opined that India has remained a reluctant and hesitant participant in Saarc from the beginning principally on account of the obduracy of one or two members of the grouping. Notwithstanding the merit of this argument, the fact remains that most issues in South Asia terrorism, maritime security, health, environment, economic growth are transnational in nature, require coordinated responses, and make regional cooperation essential, Ansari said.
Ansari pointed out how the EU has lived up to the expectations of its founding fathers and has transformed itself from being a purely economic grouping to a union of sovereign states enjoying an unprecedented degree of political and economic integration. This example has been emulated by others Asean and GCC in Asia at different stages of economic integration, groups like IOR-ARC, BIMSTEC and our own Saarc are trying to move forward. In Africa, there was the African Union and the regional communities, such as SADC, COMESA, and ECOWAS.