ISSN: 1391 - 0531
Sunday, April 01, 2007
Vol. 41 - No 44

Hope vs reality

Trade and terrorism are on the agenda for the 14th South Asian Association for Regional Cooperation (SAARC) summit in New Delhi on April 3 and 4. Here is an overview of the group and its agenda.


SAARC was established in 1985 by Bangladesh, Bhutan, India, the Maldives, Nepal, Pakistan and Sri Lanka.
- Formed to help boost economic growth and trade in one of the world's poorest regions -- home to about 1.5 billion people, tens of millions of whom live in abject poverty -- it has been flayed by critics who say it has remained a talking shop where lofty speeches are rarely translated into action.


Trade between members did not accelerate in the five years after structured economic cooperation began with the SAARC Preferential Trading Arrangement (SAPTA) in December 1995.

Intra-SAARC trade remained at 3.8 percent of the region's total trade in 2000, a 2003 International Monetary Fund report said. Recent figures put it at 5.3 percent of exports and 4.8 percent of imports.

- Signed in January 2004, the South Asian Free Trade Area (SAFTA) agreement, supposed to supersede SAPTA, finally came into force in July 2006.

Aimed at achieving zero tariffs on almost all products by 2012, SAFTA has witnessed squabbles over tariff concessions with Pakistan accusing India of violating the agreement with various Non-Tariff Barriers.

SAARC's perceived failure to take off despite many summits has been traced to mistrust and animosity between its two biggest members, India and Pakistan, whose rivalry dates back to their independence in 1947. Their uneasy ties, particularly over disputed Kashmir, still undermine greater regional cooperation.


Afghanistan formally becomes the group's eighth member at the Delhi summit. In joining, strategically located Afghanistan hopes to link its war-ravaged economy with the relatively more prosperous subcontinent to spur reconstruction and development.- China, Japan, South Korea, the United States and the European Union have observer status.


Sri Lanka's foreign minister said he would push for a regional counter-terrorism drive at the summit, after the March 27 air attack by rebel separatist group, the Liberation Tigers of Tamil Eelam, on a Sri Lankan airbase this week.
- Forming an economic union with a single currency by 2020 could be discussed. - Reuters

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Copyright 2007 Wijeya Newspapers Ltd.Colombo. Sri Lanka.