LAHORE, Oct 8: The South Asian countries cannot resolve their economic and non-military problems without cooperating with each other.

"These (Saarc) states are making a big mistake by waiting for other (political) problems to be resolved before taking up the non-military (economic and trade, environmental, societal, etc) issues," a former Indian soldier, Lt-Gen VR Raghavan (retired), said at the inaugural session of a two-day conference on Economic Growth and Security.

The conference has been held by the Indian think-tank - Delhi Policy Group - in collaboration with the Lahore University of Management Sciences. Later talking to reporters, he said the settlement of the Kashmir issue would take time. "Both nations are talking to each other to resolve all their outstanding bilateral issues, which is a good news."

Answering a question, he said it was essential to create an environment of trust and confidence between Pakistan and India to convince them to stop the arms race and cut down their defence budgets.

LUMS Pro-Chancellor Syed Babar Ali underscored the need for better understanding in the region for economic and social development. "Some 50 years ago, South Asia and South East Asia began at the same level. Today South East Asian states are miles ahead of us," he lamented.

He called for regional economic and investment cooperation for eradication of poverty, saying that the South Asian countries had the largest population of the poor in the world.

Union Bank chairman Mueen Afzal stressed the need for rational and dispassionate dialogue on Indo-Pak issues. In his presentation on growth, poverty and peace in South Asia read at the first session, leading economist Dr Akmal Husain set out the economic logic of regional cooperation in South Asia, and specific policy actions that could be taken for improving health, education, and employment of the deprived segments of the nations.

But, he said, the prerequisite for such a process to begin was a change in the government's mindset. "There is an urgent need for moving out of a mindset that regards the adversarial relationship with a neighbouring country as an emblem of patriotism, affluence of the few at the expense of the many as a hallmark of development and the individual greed as the basis of public action and mutual demonization as the basis of inter-state relations.

We have arrived at the end of the epoch when we could hope to conduct social, economic, and political life on the basis of such a mindset. If the people of South Asia, as a whole, are to actualize their potential for development, a sustained and rapid peace process between India and Pakistan is the need of the hour," Dr Husain said.

National Council of Applied Economic Research, New Delhi, Director-General Dr Suman Bery, Member Central Committee Nepali Congress Dr RS Mahat, and Director Collective for Social Science Research Dr Asad Sayeed also read out their papers. Others who spoke included The Nation's managing editor Arif Nizami, former Punjab governor Shahid Hamid and Haroon Sharif.