SAARC

Topic:
SAARC (South Asian Association of Regional Cooperation)

Past, Present and Future Prospects

Kanwal Batool Naqvi

SAARC
1: HISTORY 1977-85: Bangladesh Contribution 1985: Charter-December 08, 1985 2012: Economic Union Dream? 2015: Single Currency?

SAARC
2: PRINCIPLES Focus: Cooperation in SAARC Bilateral Multilateral 1. Sovereign equality 2. Territorial integrity 3. Political independence 4. Non-interference in internal affairs af other states and mutual benefits
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SAARC
3: OBJECTIVES
1. Inter-SAARC 1. Welfare to people (quality of life) 2. Economic growth 3. Collaboration Economic Social Culture Scientific 4. Collective self reliance 5. Mutual trust, under-standing and appreciation Intra-SAARC 1. Inter-cooperation in national forums 2. Domestic countries strengthening 3. International and regional organizations
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4: SAARC-Current Members 1. Afghanistan (Number 13, 2005) 2. Bangladesh 3. Bhutan 4. India 5. Maldives 6. Nepal 7. Pakistan 8. Sri Lanka Share of Population in the World: 23.19% Based on: World Development Report 2012.
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SAARC

SAARC
6: SAARC-Summits
S. No. 1st 2nd 3rd 4th Dhaka Bangalore Kathmandu Islamabad Location Date of Summit 7-8, December, 1985 16-17 November, 1986 2-4 November, 1987 29-31 December, 1988

5th
6th 7th 8th 9th 10th

Male
Colombo Dhaka New Delhi Male Colombo

21-23 November, 1990

21st December, 1991 10-11 April, 1993 2-4 May, 1995 12-14 May, 1997 29-31 July, 1998

SAARC
6: SAARC-Summits
S. No. 11th 12th 13th 14th 15th 16th 17 Kathmandu Islamabad Dhaka New Delhi Colombo Thimphu Male Location Date of Summit 4-6 January, 2002 2-6 January, 2004 12-13 November, 2005 3-4 April, 2007 1-3 August 2008 28-29 April, 2010 November 10-11, 2011

WORK PACKAGES 1. India 1. Business information data networking 2. HRM 3. S & T 4. Social dimension in business development 2. Pakistan 1. Trade 2. Investment 3. Sri Lanka Women Entrepreneurship 4. Bangladesh Telecommunication 5. Nepal Travel & Tourism Maldives-tourism 6. Bhutan & Nepal Energy

SAARC

8: INITIATIVES - SAPTA - SAFTA - SAARC University INSTITUTIONS 1. People to people contact 2. Regional - Agricultural infrastructure: Bangladesh 3. Funds - Regional Projects - Japan Special Funds - South Asia Development Fund - Other Funds 4. SAARC Chamber of Commerce & Industry: Islamabad-1992

SAARC

SAARC
10: UNIQUE FEATURES
1. 2. 3. 4. 5. 6. 7. 8. 9. The oldest ancient living civilizations Worlds sleeping giant-started moving People of all regilons, faiths, ideologies live Economic force-common market The largest irrigated area The second largest railway network The largest English speaking area The largest labour force: 425m people Home of the poorest: - Job openings - Self employment 10. 750m commerce-the largest single block

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12: CHALLENGES 1. Poverty 2. Unemployment 3. Literacy 4. Governance 5. Education 6. Development 7. Enabling environment 8. Defense expenditure

SAARC

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ECONOMIC CHALLENGES AND

ECONOMIC CHALLENGES FOR PAKISTAN

The Pakistans economy is currently passing through the most difficult phase of its economic history. Once a robust economy, with economic growth over 6% of GDP, now it has been transformed into a fragile economy, due to serious economic challenges, the most important being our countrys frontline role in War on Terror and the persistent Power and Energy Crisis which has crippled our industrial sector.

Before I proceed further, lets see what the IMF Mission, which recently visited Pakistan in October 2012, says in its Report :
The

Pakistans economic situation is deteriorating and Islamabad urgently needs to address deep problems in its energy sector while boosting growth to meet a rapidly growing population.

The IMF Mission further goes on to say that: countrys GDP in 2012-13 is likely to grow at the annual rate of 3% to 3.5%, not enough to provide jobs to the growing labor force. Decisive and far-sighted action is needed to address this challenging outlook.
The

The IMF Mission Report points out that ENERGY PROBLEM is the largest single impediment to higher economic growth for Pakistan and a major factor behind macroeconomic imbalances. For this, it has outlined a comprehensive approach to reform to tackle these problems.

The Challenges that our Country faces today do not commensurate with the abundant and vast potential that it possesses.
Pakistan offers huge potential and

opportunities for trade and investment to both foreign investors and the local economy. Pakistan is ranked number one in the World Banks Ease of Doing Business Index. in Asia

Pakistan is worlds 2nd largest producer of water, buffalo meat and milk

Pakistan is worlds 3rd largest producer of cotton Pakistan is the 4th largest goat meat supplier Pakistan has 5th largest Coal and Gold reserves Pakistan is the 7th largest wheat grower

Prospects and Economic Revival Efforts

The economic growth of Pakistan stood at 3.7% in FY 2012 which is higher than 3% realized in previous year, but less than the target of 4.2 percent. The State Bank of Pakistan in its third quarterly Report State of the Economy says that this performance is notable, given the following challenges: Considerable damage to cotton crop due to floods Ongoing energy shortages; Rise in international oil prices; and

The State Bank comments on the economy recovery prospects as follows:

Although Pakistans economy has shown some recovery in terms of GDP growth, the key macro indicators still remain weak. Persistent inflation and pressure on the fiscal and current accounts, remain the key challenges for the economy

Like IMF, the State Bank of Pakistan also pinpoints that Low investment and energy shortages have direct growth implications. Other areas that poses challenge and major risk to the macro-economy is

Pakistan must overcome its economic challenges as it has vital role to play to bring economic prosperity in SAARC Region
SAARC region has potential of becoming a vibrant region in the world given its enormous resources in manpower, technology, agricultural and mineral assets, its history and civilization. Pakistan must take immediate measures to meet its present economic challenges as it has a more vibrant role to play for the regional cooperation in the SAARC region. Pakistan could play an important role in bringing the people of SAARC together by promoting investment, trade and people to people contacts.

The Existing Potential in the South Asian Region

South Asia is the second fastest growing region in the world and it has the potential to be an economic power by the year 2025. Many in South Asia, however, still face extreme poverty, especially the SAARC countries.

South Asia is home to half of the worlds poor, with 40% of its population living on less than $1.25 a day.
South Asia accounts for only 2.5% of GDP 2% of world exports, and 1.6% of world Foreign Direct Investment .

SAARC countries have common economic goals and economic challenges

Significant challenges and barriers still exist which continue to restrict the economic growth and integration in the SAARC region. What is required is a firm commitment by the SAARC countries to move towards prosperity by placing stronger emphasis on economic development through REGIONAL PARTNERSHIPS as they share common economic goals and challenges.

Private Sector in SAARC countries have to play a Pro-active Role

The private sectors of SAARC countries are already involved in promoting economic cooperation in the region but they must be pro-active to put a firm pressure on their respective governments to provide a business enabling environment to foster the pace of economic development and cooperation within the region. The Private sector must play a dynamic role to bring about revolutionary changes and foster the pace of regional integration in SAARC region.

Key Challenges for SAARC Region

While SAARC countries continue to make efforts for economic development and intra-regional integration, their progress is curtailed by a continuing sub-set of systemic issues and challenges common to all member nations.

I would like to outline few of the key challenges and issues that are creating barriers in the way of increasing flow of trade and investment among the SAARC Countries

 Political Mindsets and Issues Abject Poverty Low Intra-regional trade Low- Intra-regional or cross-border Investment Poor Transport Network or Infrastructure to facilitate trade Sizable Sensitive List, Para Tariff and Non-Tariff Barriers Food Security issues

Climatic Change Issues (floods and natural disasters)

Under-utilization of renewable energy resources Stringent visa requirements

The above challenges need to be dealt on preferential basis by the SAARC countries, especially the two big nations PAKISTAN and INDIA.

More IntraSAARC Trade can lead to Better economic conditions for People
Intra-regional trade is one of the important measures to alleviate and improve the economic condition of the people of this region. However, as also indicated in the list of barriers the Intra regional trade among the SAARC member states is marred by the issues of nontariff barriers and sensitive list. The SAARC states must, therefore, address this issue immediately and effectively for rapid expansion of intra regional trade.

More Intra-SAARC Investment can lead to less dependence on Western Investors

The investment regime in SAARC is not only restrictive but lacks policy harmonization. Supporting mechanisms are needed to support capital flow and help attract more Foreign Direct Investment (FDI) within SAARC countries and depend less on investment from outside the region. The FDI sources are highly diversified in SAARC countries, mostly still originating in developed countries, outside the region. India, Bangladesh and Pakistan attract most of their FDI inflows from countries outside the region.

There is strong case for deeper intraregional investment.

Expanding intraregional investment is the key to bolstering the investment regime in SAARC region.

I would suggest that Boards of Investments in the SAARC countries should promote more intraregional investment by establishing their offices in each others country.
.

I would like to highlight two other issues, which are not directly concerned with economy, trade or investment, but these issues or challenges have direct bearing on all of them. These challenges are Food Security Issues and Natural Disaster

Food Security Issues

Considering that the estimated population of South Asia will rise by 25% to 2000 million in 2025, food security is the most tangible threat to all SAARC countries.
This threat cannot be mitigated by a variable increase in food production alone, but by efforts to drastically improve access to food sources and clean drinking water.

Natural Disasters
SAARC countries are at greatest risk of natural disasters like earthquakes, floods and cyclones, which are already having major impacts on their economic performance. These have resulted in lower agricultural productivity in the entire region. If this continues, it can turn out in shape of severe economic shocks for the SAARC Countries. To address the above two issues, the SAARC countries must take action on immediate basis.

Key Opportunities for SAARC Region

There is always a blessing in disguise.
Though the SAARC region is facing a host of challenges but there are Opportunities as well. We need to identify and explore them. Few areas are highlighted here, which have so far not been explored.

(1) Cooperation in Services

Telecommunication Banking Energy Transport Software services

(2) Sharing Renewable Energy

SAARC Region has enormous potential in Energy, especially HYDRO-POWER, but only 10% of this potential is currently being utilized. Renewable energy options such as SOLAR and WIND-POWER need to be seriously considered as these are vital for the economic growth and sustainability of SAARC.
India has around 25000MW of wind power, which can be exported to other SAARC countries. The Renewable Energy sources in SAARC countries need to be tapped through infrastructure development, integrated investment promotion policy and government pledges.

(3) Greater involvement of Private Sectors of SAARC

The SAARC Governments must consider an increased role for their private sectors in establishing public-private partnerships, where possible, in SAARC countries. The Private sector needs to be more involved in guiding Government policies through lobbying and advocacy efforts. The private sector is effective in bringing in a commercial orientation and operating in a non-political way. They also have strong implementation capacities to strengthen economic and business opportunities along with trade in the region.

(4) Promising Youth leadership

The young business leaders of SAARC region should be brought together to prepare them as the next generation of business leaders for South Asia and to identify their role in the formation of an integrated future business community. There is strong need for youth empowerment and focus on business leadership for South Asian economic development.

(5) Investment in Health and Education

SAARC countries have received bulk of FDI in sectors like Telecommunication, Transportation, Exploration of mineral and natural resources, while other core sectors like health and education are given least importance. Investment in health and education sectors in form of FDI or Joint Ventures between public and private enterprises is squarely productive, which will not only enhance Human Development Index of the region but also help achieve sustainable economic growth.

Concluding Remarks
SAARC was established in 1985 and the primary objective identified in its Charter says: To promote the welfare of the peoples of South Asia and to improve their quality of life" The question is has SAARC achieved this objective?

Way Forward
I think that the two bigger countries Pakistan and India should have to play their due role to move SAARC towards the objective as given in its Charter. I also think that the Role of private sector is quite important as economy drives politics, and business shapes the social values. Businesses have the power to make a difference.

Way Forward
As far as Pakistan is concerned, I think that there is need to create synergy between government and business community to help resolve the present economic crisis and put the country on path of progress and prosperity.

The Institute of Cost and Management Accountants is always there to help the Government in its efforts to bring economic prosperity by extending its professional expertise.

South Asian Regional Standards Organisation (SARSO)

Chandan Bahl Scientist E(International Relations) Bureau of Indian Standards India

Disclaimer:

This is not a presentation by SARSO but it is presentation of factual information on SARSO by BIS

ABOUT SAARC
South Asian Association for Regional Cooperation (SAARC) was formally launched in 1985 Its seven founding members are Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan, and Sri Lanka. Afghanistan joined SAARC in 2007 The main objectives of SAARC are to place regional cooperation on a firm foundation, accelerate the pace of social and economic development of the countries, and further the cause of peace, progress and stability in the region.

TRADE AND REGULATORY COOPERATION

With the increase in non-tariff barriers in trade, countries/ regions need to look at ways to combat them and thus Regulatory Cooperation assumes importance. Harmonization of technical standards and mutual recognition of conformity assessment procedures between trading partners are forms of Regulatory Cooperation that helps in removing the technical barriers to trade and facilitates flow of goods and services in the region.

ESTABLISHMENT OF SARSO- BACKGROUND

SAARC Committee on Economic Cooperation (CEC) established in 1991, for identifying and implementing programmes in the core area of economic and trade cooperation. The Sub-Group on Standards and Quality working under the auspices of the CEC in its 2nd meeting on 30-31 August 2006, decided to set up the SAARC Standards Coordination Board (SSCB), as a precursor to the setting up of the SAARC Regional Standards Body SSCB comprised of a member from each of the National Standards Body of the Member States

ESTABLISHMENT OF SARSO- BACKGROUND

SSCB at its 3rd meeting held on 1-2 Nov 2007, recommended for setting up of the SAARC Regional Standards Body, to be formally named as the South Asian Regional Standards Organization (SARSO)
SSCB approved the text of the draft agreement for establishment of SARSO

SARSO AGREEMENT
The Agreement on the Establishment of the South Asia Regional Standards Organization (SARSO), was signed at 15th SAARC Summit held in Colombo, Sri Lanka on 2nd - 3rd August, 2008, by the Foreign Ministers of the SAARC Member States The Agreement on establishment of SARSO has since been ratified by all Member States with Afghanistan ratifying the Agreement in May 2011. The Agreement on establishment of SARSO has entered into force with effect from 25 August 2011 with issuance of Notification to this effect by the SAARC Secretariat.

SARSO is to be located in Dhaka, Bangladesh

The first meeting of the Governing Board of SARSO is likely to be held in December 2011 in Bangladesh

OBJECTIVES OF SARSO
To promote and undertake harmonization of national standards of the SAARC Member States with a view to removing TBT and facilitate flow of goods and services in the region

To develop SAARC standards on the products of regional/sub-regional interest

To encourage the use of international standards published by ISO, IEC, etc. by way of adoption, where appropriate, as SAARC Standards

OBJECTIVES OF SARSO (Contd..)

To encourage exchange of information and expertise among the NSBs of the Member States in the fields of Standardization and Conformity Assessment To facilitate capacity building among the Member States in the fields of Standardization and Conformity Assessment by way of training, workshops, seminars, etc

To act as a source of information for the Member States on standards, regulations, conformity assessment
To present the common interests of the Member States in the various international standardization organisations

OBJECTIVES OF SARSO (Contd..)

To establish mutually beneficial cooperation with the relevant international and regional organizations as per relevant SAARC guidelines
To promote MRAs on Conformity Assessment Procedures among the Member States To encourage sharing of facilities relating to conformity assessment procedures among the Member States

To explore the possibility of having a common mark of conformity among the Member States
To undertake any other task(s) as deemed appropriate.

STRUCTURE OF SARSO The Organisation shall comprise of: Governing Board Technical Management Board (TMB) Director-General; and Secretariat.

Composition of Governing Board

highest authority of SARSO vested with all powers relating to its functioning.
consists of the Heads of respective NSB of each Member State. Each Member and his/her Alternate shall serve at the pleasure of the appointing Member State. The Chairperson of TMB, the Secretary General of SAARC or his representative and the Head of the Secretariat to be the exofficio Members of the Governing Board.

Functions of Governing Board (GB)

GB may create and assign other entities, as and when required, for the smooth operation of the activities of SARSO
In line with the objectives and functions of SARSO, GB shall formulate policies for the effective functioning of SARSO GB may also give directives and provide guidance to the other organs of SARSO including TMB and Sectoral Technical Committees.

Technical Management Board (TMB)

consists of one technical expert nominated by each NSB of the Member States.
responsible for the planning, coordination and monitoring of all the technical work of SARSO.

may establish Sectoral Technical Committees (STC) as and when deemed necessary for development of harmonised standards
scope and programme of work for each STC under TMB shall be approved by GB shall meet at least annually preferably immediately before GB meetings and submit its reports to GB

Director-General and the Secretariat

SARSO shall be headed by a Director-General who will be appointed by the Governing Board for a period of three years from among the nationals of the Member States The Organisation shall have a Secretariat consisting of officers and staff

ON GOING WORK
Development of SAARC Standards
The following products have been identified harmonization/development of SAARC Standards:
Sugar
Instant Noodles Textile Fabric Jute Tubes Skimmed Milk Powder Vegetable Ghee Cement Structural Steel Toilet Soap Biscuits Electric Cables Steel

for

Sector based approach adopted for harmonization/ development of SAARC standards with setting up of Sectoral Technical Committees
(i) (ii) (iii) (iv) (v) Food and Agricultural Products Electrical, Electronics, Telecoms and IT Jute, Textiles & Leather Building Materials Chemical and Chemical Products

ON GOING WORK

Draft SAARC Agreement on Implementation of Regional Standards The objective of this agreement is to provide the framework as well as the guiding principles for implementation of the SAARC standards

ON GOING WORK

Draft SAARC Agreement on Multilateral Arrangement on Recognition of Conformity Assessment

The objective of this Agreement is to facilitate SAARC Member States to accept results of conformity assessment

EXPECTED BENEFITS INDIAN PERSPECTIVE

Harmonization of national standards of the Member States would help in removing the technical barriers to trade and facilitate flow of goods and services in the region
Facilitate in projecting common interests of the Member States in the various international standardization organizations Facilitate acceptance of results of conformity assessment amongst the countries in the region, and Facilitate capacity building among Member States