Safta’s birth pains

THE doubts expressed the other day by Bangladesh Foreign Minister M. Morshed Khan about the South Asia Free Trade Agreement (Safta) coming into effect on January 1, 2006, as scheduled, seem valid. Many important issues which needed to be clarified well before the scheduled 13th Saarc summit in Dhaka could not be attended to because of the delay in holding the summit by almost 10 months as it was postponed twice on India’s request. The framework Safta agreement signed at the 12th Saarc summit in Islamabad in January 2004 had left rules of origin, sensitive lists, revenue loss compensation for the least developed countries (LDCs) and trade-related technical assistance to these countries incomplete. Now even if these are clarified and solutions found by October when the rescheduled summit is to be held, incorporating them in the respective trade and investment regimes of all seven Saarc countries would certainly take more than three months — well beyond the January 1, 2006, deadline. Even some of the agreed points like the format of tariff reduction are likely to be reopened at the next summit because some of the countries feel that despite reduction in average tariffs, distortions will remain in the form of high tariffs in respect of particular products in some countries.

Indeed, convergence is necessary before commencing the tariff reduction process. On the issue of a negative list, some analysts have wondered why there is no deadline for determining the negative list and no timetable for phasing out the list over the years. It is suggested by experts that the phasing out be considered on the basis of an Inclusion List, Temporary Exclusion List, Sensitive List and a General Exception List for implementing a Common Effective Preferential Tariff. It is also believed that without significant changes in the production structure, the LDCs are not likely to derive equitable benefits from Safta. So, they would need technical and financial help from the non-LDCs to see them through this restructuring phase. Also, the agreement is silent on how existing bilateral free trade agreements between Saarc countries such as those between India and Sri Lanka, India and Nepal, Pakistan and Sri Lanka and a proposed one between India and Bangladesh will be integrated into Safta. The Safta agreement does not refer to liberalization of trade in services. It is also felt in many quarters that as long as Pakistan continued to refuse to give MFN (‘most favoured nation’) status to India, it would be next to impossible for Safta to take off.

In the final analysis, Safta will succeed only if and when Pakistan and India give up their political reluctance to enter into a full-fledged and mutually beneficial economic relationship. Substantial regional trade is already taking place in South Asia with informal transactions amounting to a large proportion of the formal trade. The intra-regional trade is estimated anywhere between eight to ten per cent of each country’s total trade. In case Safta gets further delayed, the loss will only be of the regional members. Data shows that nearly 60 per cent of world trade is now being conducted on a preferential basis. The countries that are not part of a trade bloc are likely in the coming years to face increasing discrimination against their exports and would suffer serious losses in a highly competitive world market.

The price of occupation

TWENTY-TWO Americans, one of them a civilian, have lost their lives in Iraq in three days. For eight days, the figure goes up to 37. Wednesday was one of the bloodiest days for America, for it lost 14 marines, besides the murder of a freelance journalist. The rise in casualties shows the strength of the insurgency, for the militants are now using more powerful and lethal weapons. In Wednesday’s attack, they demonstrated their fire power by destroying an amphibious assault vehicle carrying the marines. As a US general put it, “... this is a very brutal, lethal and adaptive enemy.” Why is the enemy so “brutal” and “adaptive” (in developing new weapons) is the real issue and not the weapons he is using. Weapons are of secondary importance; what is of primary importance is the motive behind the insurgency: getting rid of the foreign forces occupying Iraq. More than 28 months after the overthrow of the Baathist regime, the US-led forces are still there, with no indications when the occupation will come to an end. The only positive development has been the assumption of office by an elected government, but this government has not been able to command respect and obedience of the people. By and large, it is seen as a collaborator. That is the reason why the resistance has been attacking not only foreign troops but also the Iraqi government’s security personnel.

As British Foreign Secretary Jack Straw said the other day, foreign forces in Iraq are part of the problem. One hopes the White House, too, is able to grasp this truth. The US administration has not given any date for a withdrawal of US troops, and indeed President Bush has reiterated his policy of staying on. This will only serve to strengthen the resistance. A hurried withdrawal may not be possible. That could lead to chaos. The only sensible course of action will be to induct a UN peacekeeping force, which should organize a general election. Only a government that comes into being through such a process will be able to tackle insurgency and work for Iraq’s reconstruction. Failing that, the resistance will continue to be stronger and stronger.

Eradicating polio

IT is not for the first time that a government official — in this case the EDO, community development, in Hyderabad — has stressed combined efforts by the government and independent organizations to combat polio in the country. The point has been made before, and raising public awareness on the subject has figured high on the health department’s list of priorities. However, while the authorities appear keen to extend vaccination cover in remote areas and have, indeed, made substantial progress towards eradicating polio over the years, cases of the disease still continue to crop up. Only recently, the NWFP reported its second polio case in the year. In both cases, the affected children had already been administered the required number of anti-polio doses. This is similar to the situation in Sindh last year when 85 per cent of those who contracted the debilitating disease were found to have already been administered the vaccine — a worrying development that leads one to question storage conditions and the efficacy of the polio drops.

Besides this factor, there are several others that are slowing down progress on achieving the target of a polio-free Pakistan by the end of this year. These include poor access to remote areas and hence limited vaccination coverage as well as team fatigue. There is also the problem of convincing parents to have their children inoculated as many view the vaccine with suspicion, including those who wield considerable influence over the people such as local religious figures and village elders. For the anti-polio drive to be effective, it is necessary for the health authorities to take a hard look at the current plan and identify its lapses, many of which may relate to coordination among the various government agencies. That is the only way that a new, more effective strategy can be devised for combating the polio menace.