The 18th summit of the South Asian Association for Regional Cooperation has just concluded in Kathmandu adopting a 36-point declaration that commits the group to consolidating itself into an economic union in 15 years, increasing its transport and connectivity and fighting its common enemy — terrorism and extremism. If the union becomes reality, it will be the largest common market in the world. However, progress has been disappointing so far.
SAARC is an excellent idea struggling to take off due mainly to the lack of direction and conflict between its two nuclear-powered members.
Established in 1983, the 8-member SAARC aims to promote the welfare of South Asians, accelerate growth in the region, strengthen collective self-reliance among its members, expand active collaboration and mutual assistance, strengthen cooperation with other developing countries and cooperate with regional and international organizations. It has identified 16 areas for cooperation and created 11 centers to promote collaboration.
However, the result thus far remains highly wanting. SAARC has, it is widely believed, stagnated due to managerial, institutional and funding problems. Indeed, the small SAARC secretariat — headed by a nominee of a member state in rotation, based on political connection rather than managerial competence — works only as a filekeeper. It is weak and inconsequential in mandate and in funding. Nonetheless, they are not the main obstacles holding SAARC back.
The actual culprits are the lack of clear leadership and the bilateral dispute between India and Pakistan, the two members of the organization and nuclear weapons states.
SAARC has lacked a clear direction and sustained leadership since its inception. You need the largest member to steer the organization forward, as Germany for the European Union, Brazil for Mercosur, and Saudi Arabia for the Gulf Coordination Council. However, the largest member of SAARC, India, has generally been ambivalent about SAARC and reluctant to lead the regional economies toward greater integration.
While this Indian ambivalence towards SAARC has been generally under the surface, Ramesh Bhandari, the outspoken former Indian foreign secretary, brought it over the surface by, in essence, saying that SAARC was formed to enable small countries to gang up against India. I do not know about other countries, but from Nepal’s perspective, Bhandari’s apprehension is not true.
As long as this fear haunts India, SAARC summits will continue to remain a talking shop and regional cooperation a potent opportunity deliberately not tapped. Bilateral disputes, especially between India and Pakistan, both nuclear powers, are another set of the main obstacles to SAARC’s progress. Bilateral issues, though barred from discussion in formal SAARC forums by its Charter, nonetheless continue sabotage regional cooperation.
To enhance cooperation for mutual benefits, nations must put their disputes and differences on hold. The United States and China did so regarding Taiwan in 1971 and benefited enormously. However, Pakistan has refused to put Kashmir, which is divided between Indian-controlled and Pakistani-controlled parts, on hold. Both India and Pakistan accuse each other for war-mongering, sabotage, and terrorism.
Such blames are not unfounded. The two countries have fought three wars over the Kashmir dispute. Pakistani officials have been found peddling fake Indian currency notes to support anti-Indian organizations in Kashmir and Pakistan. Pakistan-based organizations committed to freeing Indian-controlled Kashmir have carried out terrorist attacks in many places in India, including in Mumbai in 2008. Pakistan blamed India for supporting terrorists in Baluchistan, where anti-Pakistan sentiment runs high. The two countries want Afghanistan in their tent.
These issues and consequent mistrust have stood in the way of regional economic integration that SAARC seeks to promote. Therefore, the goal of liberalizing trade and creating a common market of 1.7 billion people has remained unfulfilled. Strangely, even though these two countries share 2,900 KM border, the bulk of their between Pakistan and India is still conducted through third countries like Singapore or the United Arab Emirates.
Yet, SAARC has been useful in many ways. It has created a sense of belonging in the region to its members. It has attracted other countries, including China, to participate in its activities. China, an observer now, wants to become a full member of SARRC. Common regional policies have emerged in several sectors. Visas have been liberalized for 24 categories of people.
Most notably, SAARC summits have offered a useful forum regularly for discussing bilateral issues and diffusing bilateral tensions, especially for India and Pakistan. Notably, the 11th SAARC summit in 2002 held in Kathmandu thawed the frozen relations between Indian and Pakistan. The Indian Prime Minister Atal Behari Vajpayee had refused to meet with Pervez Musharraf, who took power in a coup in Pakistan in 1999. Musharraf, after his keynote speech, went straight to Vajpayee and shook hands, which opened the door for reviving the stalled negotiations and for starting a bus service between the two countries.
This time, too, Indian Prime Minister Narendra Modi avoided his Pakistani counterpart Nawaz Sharif due to the recent exchange of fires between the two sides in Kashmir. The good will generated by Sharif’s participation in Modi’s inaugural as prime minister had vanished. It has disappointed the international community and the media, which had expected Indo-Pak talks on the sidelines on Kashmir and on Afghanistan. Only on the last day of the summit, the two leaders shook hands on the stage to a long applause.
The 18th SAARC summit turned out to be a boon for Nepal from bilateral point of view. Nepal and India have signed 10 agreements during Indian Prime Minister Narendra Modi’s Kathmandu visit to participate in the SAARC summit. They have agreed, among other things, to implement the 900-MW Arun III hydropower project jointly, start bus services between Kathmandu and Delhi and from other two points, and cooperate in the execution of several other projects.
In the coming days, we will come to know how the handshake between the rivals has helped thaw their frozen relations and how other countries have benefited bilaterally from this summit. As for the regional economic integration, not much can be expected until India takes active lead and until India and Pakistan agree to put their bilateral disputes on hold for a number of years and focus on economic growth and trade liberalization.