South Asia Forum calls for regional economic unionSeptember 8th, 2011 - 8:30 pm ICT by IANS
New Delhi, Sep 8 (IANS) Members of the South Asian Association for Regional Cooperation (SAARC), at the South Asia Forum here Thursday, called for removing tariff and non-tariff barriers to boost regional trade and investment and prepare a road map for regional economic union.
“A range of tariff and non-tariff barriers, that have been erected in our region in the early years of our respective independence prevented businesses from developing value in the neighbourhood,” Planning Commission Deputy Chairman Montek Singh Ahluwalia said in his address on behalf of the Indian government.
He said the South Asia region is geographically and culturally designed for the widest possible cooperation but in reality, is the least integrated region in the world.
India is hosting the first meeting of South Asia Forum, organised by the ministry of external affairs and the Federation of Indian Chambers of Commerce and Industry.
Ahluwalia urged all South Asian countries to remove barriers that hinder flow of trade and investment.
“Existence of tariff walls, problematic as it is, is in a sense as much a symptom of a problem as its a challenge in itself,” he said.
Referring to a World Bank report, Ahluwalia said intra-regional trade in South Asia is less than percent of GDP, as compared to over 20 percent in East Asia. “Cost of trading across borders in South Asia is one of the highest in the world.”
He said all indices of intra-regional economic cooperation in South Asia were significantly lower than in other regions, leading to low trade and investment flows.
Pakistani delegation head Farzana Raja, who is a member of the National Assembly, the lower house of parliament, said the economic integration of the region should not be held hostage to historical legacies, differences and political disputes.
She called for implementation of the South Asian Free Trade Agreement (SAFTA) in letter and spirit. “There is a need to implement SAFTA in letter and spirit to achieve the ideal of a South Asia Economic Union,” Raja said.
Nepal’s Land Reform and Management Minister Prabhu Sah said the implementation SAFTA was hindered by tariff, non-tariff and para-tariff barriers.
He said SAARC members should take lessons from the success of economic integration in Europe and other parts of the world.
“There is no reason why such an experience cannot be emulated in our region with full implementation of SAFTA in its letter and spirit,” Sah said.
Maldives Minister of Finance and Treasury Ahmed Inaz said his country would reduce the sensitive list of goods by 60 percent as against 20 percent reduction required under the SAFTA.
Inaz emphasised on the need for allowing greater movement of people among the SAARC region.
South Asia leaders, at the 16th SAARC summit in Thimphu last year, had decided to set up a South Asia Forum to discuss issues impeding movement of trade and investment.
SAARC has eight members - India, Pakistan, Nepal, Bangladesh, Sri Lanka, Maldives, Bhutan and Afghanistan. Afghanistan is the newest member of the grouping, being admitted in the regional grouping in 2007.
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Tags: chambers of commerce, chambers of commerce and industry, economic union, farzana, indian chambers of commerce, ministry of external affairs, montek singh ahluwalia, political disputes, regional economic cooperation, regional trade, saarc, safta, south asia forum, south asia region, south asian association, south asian association for regional cooperation, south asian countries, south asian free trade agreement, tariff barriers, tariff walls