ISLAMABAD: A United Nations report describing South Asia as the world’s least integrated sub-region has emphasised that it needs to integrate more broadly into Asia-Pacific and explore the possibilities for greater interaction in the broader Eurasian economic space.
The UN Economic and Social Commission for Asia and the Pacific (UN ESCAP) report, ‘Regional Economic Cooperation and Integration in South Asia’ said that a broader and more open platform for regional cooperation could also help to diffuse the political tensions.
The report suggested that the three overlapping groups of South Asian Association for Regional Cooperation (Saarc), Economic Cooperation Organisation (ECO) and The Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC) could create an institutional arrangement to assist cross-fertilisation and learning, linking programmes to exploit alliances and network area that could become an arc of advantage.
The UN ESCAP estimated that the intra-regional export potential in South Asia was $812 billion in 2014 against actual exports of only $26.8bn, indicating that nearly 67 per cent of the potential remained untapped.
Bilateral trade between Pakistan and India could be 12 times the current level, while substantial intra-regional export gains are found for all countries, provided that comprehensive trade reforms are made.
The report also says that intra-regional trade could grow to nearly $172bn by 2020. Low levels of intra-regional trade have been due to the high proportion of unreported, informal and third-country trade, poor supply capabilities in the least developed countries and high costs of doing trade in the sub-region.
Regional cooperation should also be extended to cover shared challenges such as food insecurity and losses owing to increasing natural disasters.
Food security requires policy action to: eradicate extreme poverty, to ensure better and less unequal access to food, to extend the coverage of social protection programmes, to improve household incomes and consumption and to increase smallholder agricultural productivity.
Actions required at the sub-regional level include sharing country experiences and policy insights on these areas as well as strengthening of regional institutions such as the SAARC Food Bank. For South Asia, which accounts for almost a third of the deaths caused by disasters globally and second highest in terms of economic losses, the Sustainable Development Goals that seek disaster resilience are especially relevant.
Building on the achievements of the Regional Integrated Multi-hazard Early Warning System, which is supported by the UN ESCAP Multi-Donor Trust Fund for Tsunami, Disaster and Climate Preparedness, there is a need to put in place a network of multi-hazard early warning systems.
Similar cooperation for sharing information and knowledge towards building resilient cities in high seismic risk areas could also prove fruitful. In this area, the establishment of the Asian and Pacific Centre for the Development of Disaster Information Management in Tehran under UN ESCAP can complement the institutions created within the frameworks of the SAARC and the BIMSTEC.
Financial cooperation in the sub-region could help in closing infrastructure gaps and building productive capacities. Establishment of SAARC Finance as a regional body of central banks, the Inter-Governmental Expert Group on Financial Issues and the SAARC Public Debt Managers’ Forum are some of the key initiatives that need further strengthening. The Regional Currency Swap Arrangement and affiliation with the Asian Clearing Union are important prospects.
Published in Dawn, June 4th, 2017
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