SPEAKING
FREELY The secret to South Asian
success By Eduardo Faleiro
Speaking Freely is an Asia Times Online
feature that allows guest writers to have their say.
Please click hereif you
are interested in contributing.
The
people of South Asia constitute more than one-fifth of
mankind and are heirs to great civilizations - yet they
face momentous problems of poverty, illiteracy and
deprivation. Though the governments of the South Asian
Association for Regional Cooperation (SAARC) nations
have made efforts since independence to improve the
condition of their people, these attempts are often
thwarted by multifarious religious, ethnic and
linguistic problems. Discontentment and frustration
among the masses, faced with such tribulations,
emboldens subversive forces both within and outside to
exploit national inadequacies.
The solution to
our common predicament requires peace and an atmosphere
of dialogue and cooperation rather than of conflict and
confrontation. Peace is essential for national as well
as regional prosperity. For centuries the European
continent was the stage of power rivalries and war. To
improve their position in Europe, nation-states
established control over other parts of the world. Now
Europe appears to be a rather peaceful continent. The
very first step toward peace was found in the doctrine
of "defense and detente". While defense is an element
indispensable in uncertain circumstances, detente stands
for dialogue, arms control, the exchange of views at all
levels and alternative thinking. Detente influences the
understanding of a situation and broadens the scope of
ideas on how to deal with a tense situation that causes
war and affects the image of a country abroad. Europe
has now progressed beyond "defense and detente" and has
entered the path of effective regional integration.
So how do we achieve prosperity in South Asia?
Regional economic cooperation is a pivotal element.
Economic synergy leads more often than not to the
solution of disputes, including political differences.
It is sometimes claimed that unless economic
cooperation between India and Pakistan is normalized,
South Asian economic cooperation will not succeed. The
normalization of trade relations between the two
countries is indeed crucial for the success of SAARC.
The late Dr Mehboob-ul-Haq, former finance minister of
Pakistan and founder of the world-renowned United
Nations Development Program Human Development Reports,
has debunked what he called "Myths about Pakistan-India
Trade". Dr Haq underscored the urgency of effective
trade relations between the two countries and pointed
out that "political expediency triumphs over economic
rationality when it comes to bilateral trade between
India and Pakistan. Denial of trade does no good to
either of the two countries and lack of trade only
weakens them. Countries do not grow strong when cheap
and quality products are denied to millions of
consumers, when profitable opportunities are refused to
thousands of producers and the scope for revenue
generation is left unavailed ... India and Pakistan have
a great deal to learn from the global experience where
trade is increasingly being used as a prelude to
political reconciliation."
Addressing the
concern that trade liberalization between India and
Pakistan would weaken their domestic economies, he
commented: "This is a classic misunderstanding of free
trade that benefits all sides. Europe and America are
the largest trading partners of both India and Pakistan,
and if trade with them does not weaken them, how can
bilateral trade be harmful? Interestingly, Pakistani
products that are likely to face intense competition
from India are the same that face maximum competition in
the global markets. In any case, India and Pakistan can
maintain a negative import list of key items that they
wish to protect from each other for a definite period."
(Human Development Center 1990, based on speeches and
statements of the late Dr Mehboob-ul-Haq.)
This
reasoning is valid for all countries of South Asia. The
fears of any of the SAARC countries that economic
cooperation might destroy their own domestic economy are
unfounded and in any case, adverse effects can always be
prevented by using such devices as the negative list,
the quota system or the tariff mechanism.
It is
through regional arrangements that the countries of
Europe as well as those of South Asia obtained increased
benefits and reduced and sometimes even eliminated the
negative fallout of globalization.
The SAARC
summit held in January in Islamabad was a landmark
meeting in the life of the organization. SAARC was
created in 1985 to promote economic development and
social progress in South Asia through regional
cooperation. While SAARC has done commendable work in
some areas, it has not advanced as expected. Continuing
tensions between the two largest countries of the
subcontinent have often been blamed for such lack of
progress. The announcement of a composite dialogue
between India and Pakistan is therefore a most important
outcome of the summit. One does hope that the
machinations of extremist elements who are active in
both countries do not once again succeed in derailing
the peace process.
The South Asia Free Trade
Agreement (SAFTA) is another significant achievement. As
mentioned at the Islamabad summit, we in South Asia face
the danger of marginalization in the global economy and
even the risk of regression in spheres of social and
economic development. Regionalization is an effective
instrument to advance collective interests and a defense
against unrestrained globalization and the negative
fallout of the World Trade Organization. At present,
intraregional trade among SAARC countries is less than 5
percent, while it is 62 percent in the European Union,
55 percent in the North American Free Trade Area and 35
percent in the Association of Southeast Asian Nations.
SAFTA is the first step toward a more intense synergy
aimed at the South Asian Union and the single currency.
The agreement comes into effect on January 1,
2006, but there are hurdles to overcome before it fully
materializes. SAFTA rightly takes note of the asymmetry
in the development stages of the South Asian countries.
It aims at ensuring equitable benefit to all contracting
parties, taking into account their respective levels of
economic development. It provides for a special and
differential treatment to the least developed
contracting states (LDCS). The LDCS are allowed a larger
time frame for implementing the trade-liberalization
program. While the non-LDCS must implement SAFTA over a
period of seven years, Sri Lanka - being a small country
- gets eight years and the LDCS are permitted 10 years
for implementation.
In view of the constraints
that this region does face, it would be advisable for
India to enter into bilateral free trade agreements
without waiting for SAFTA to materialize fully. Indeed,
if the Indian economy is to grow at the rate of 7-8
percent, it is essential that it should have free trade
access to the entire South Asia region and to as many
other countries as possible.
Trade between India
and China has increased seven times since their
free-trade agreement (FTA) was signed five years ago.
Trade between India and Sri Lanka has expanded one and a
half times since their bilateral FTA was signed two
years ago. As a result of the very positive fallout and
mutual benefit, a comprehensive economic partnership
agreement is now being negotiated by the two governments
to expand bilateral trade further and also to address
the services sector. The Indo-Sri Lanka Free Trade
Agreement ought to be a model for similar agreements
with not only countries of South Asia but elsewhere.
Formal trade between India and Pakistan stands currently
at about US$251 million. If a FTA comes into effect,
bilateral trade could easily increase to more than $4
billion within two to three years.
SAARC
attaches great importance to people-to-people contacts
in the region so as to strengthen goodwill and foster
better understanding. Travel between India and Pakistan
has now been restored, but relaxation of the visa regime
is essential for full benefit of the reopening of road,
rail and air links between the two countries. Sri Lanka,
though it faces a major terrorist threat, has taken the
initiative to exempt SAARC nationals from visa
requirements for business and tourism. The governments
of South Asia should reciprocate this move not merely
with regard to Sri Lanka, but also other SAARC
countries. Indeed, terrorists do not travel on passports
and visas. Travel restrictions as well as those on the
exchange of books and journals should be removed without
delay. The positive impact will far outweigh the
negative factors involved in a visa-free South Asia.
The social charter announced at the SAARC summit
addresses itself to the issue of poverty alleviation,
education and health. South Asia continues to have the
highest number of people in the world living below the
poverty line, outstripping sub-Saharan Africa in this
regard. Last year, the United Nations Educational,
Scientific and Cultural Organization (UNESCO) released
the "Education for All Global Monitoring Report 2002: Is
the World on Track?" The report points out that among
the 154 countries for which data are available, 28 are
not expected to attain any of the three objectives which
the international community gathered at the World
Education Forum had agreed should be achieved by all
nations by 2015. The three goals are: universal primary
education, free schooling of acceptable quality, and the
removal of gender disparities in education. All the
countries of South Asia with the exception of Sri Lanka
are among these 28 countries. Regrettably, the
subcontinent invests more in armaments than in social
infrastructure.
India and Pakistan spend more
than three times as much on weaponry as they do on
education or health. Military expenditures in South Asia
increased by 54 percent from 1992 to 2001, while for the
world as a whole such expenditure decreased by 9 percent
during the same period. India has augmented its own
defense outlay by 10 percent per year since 1997, while
the annual increase was 1.5 percent during the previous
decade. A crucial fallout of the Indo-Pak Peace Process
ought to be a drastic reduction in the defense
expenditures of both countries so that our scarce
resources are utilized toward the welfare of our people
rather than on the purchase of military hardware from
abroad.
In the words of Indian Prime Minister
Atal Bihari Vajpayee at the summit meeting: "The bonds
of ethnicity and culture which hold together the peoples
of this region are more enduring than the barriers of
political prejudice that have been erected quite
recently." Prime Minister Nawaz Sharif of Pakistan
added, "Peace is a matter of will for the leadership of
both the countries."
But such pronouncements at
SAARC summits are sometimes not matched by adequate
implementation. while congratulating the leaders of the
seven nations for the success of the summit, we do now
look forward to the fulfillment of the agreements
arrived at.
We must also strive toward
sustainable consensus. Government decision ought to be
taken by involving all concerned, including opposition
parties, but decisions once taken must hold -
notwithstanding changes in government or other political
vicissitudes.
Governments apart, civil society,
intelligentsia, the business community and the
non-governmental organizations must all emphatically
promote awareness about the need and advantage of
regional cooperation. There ought to be a much greater
interaction between civil society and the political
class across the different countries of South Asia.
Regrettably, such an interaction is minimal.
The
Association of SAARC Speakers and Parliamentarians was
created in 1992 to promote interaction among the
parliaments and parliamentarians of South Asia and to
support the work and objectives of SAARC. Though
meetings of the association are supposed to be held
every year, only three such meetings have been held so
far over the last 10 years. The meetings were held in
New Delhi in 1995, in Islamabad in 1997 and in Dhaka in
1999. At Dhaka, the Sri Lankan delegation graciously
offered to hold the next meeting. But the secretariat of
the association must take follow-up action.
Parliamentarians should be in the forefront of the cause
of greater understanding, trust and friendship among the
countries of this region.
The South Asia Forum
consists of present and former members of parliament
from all political parties. It was inaugurated at
Parliament House by Foreign Minister Yeshwant Sinha last
September. The forum shall create awareness about the
critical need for peace and cooperation. It will promote
greater interaction between the civil society and the
political class of the countries of South Asia. Such
interaction is needed for a quicker settlement of
differences and greater South Asian solidarity, the key
to progress and prosperity of all our peoples.
Eduardo Faleiro is a former minister
of state for Indian external affairs and is currently a
member of parliament and chairman of the South Asia
Forum.
Speaking Freely is an Asia Times
Online feature that allows guest writers to have their
say. Please click hereif you
are interested in contributing.
