ISLAMABAD, Sept 24: The World Bank has asked the South Asian countries to undertake the third phase of reforms to further lower their trade barriers, which are extremely high in India and Bangladesh.

A latest World Bank report “Trade Policies in South Asia: An Overview” said that during the last decade, South Asia’s five largest countries — India, Pakistan, Sri Lanka, Bangladesh and Nepal — have been implementing trade policy reforms, gradually moving their economies away from protectionism toward greater trade openness and global economic integration. However, the report said that now was the time when all the South Asian countries should further lower their trade barriers.

Pakistan’s comprehensive liberalization of its trade policies since 1996-97, and Sri Lanka’s potential to resume long-deferred reform as prospects of ending its civil war improve contribute to a regional picture of very mixed achievement but widely shared opportunity.

“The South Asian countries missed the tide that carried many of their East and Southeast Asian neighbours to record rates of growth and poverty reduction during the 1960s and 1970s, but their later trade policy and other liberalizing reforms came in time for them to benefit from the expansion of production and trade in the world economy during the 1990s,” the report said.

The bulk of the report describes key aspects of the current trade regimes in the five largest South Asian states and the policies and practices that have produced the systems now in place. It principally focuses on traditional trade policies, which affect imports and exports — tariffs, non-tariff barriers, anti-dumping export policies, and to a limited extent aspect of sanitary and technical regulations which affect the trade.

There is now a broad consensus in South Asia that openness to trade must be a key component of policies to accelerate economic growth. Despite this, when it comes to actually implementing measures that reduce protection or subsidies for domestic producers, as elsewhere in the world, there is understandable opposition from the enterprises and other interest groups that feel that they may be adversely affected.

In spite of strong international evidence to the contrary, there are still many groups in South Asia with political connections, which hold these and similar views, especially in India, Bangladesh and Pakistan.