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Home  » Economy. Business » Regional Integration an Imperative to Face Shared Challenges and Realize Shared Goals: Ranjan Mathai
  Regional Integration an Imperative to Face Shared Challenges and Realize Shared Goals: Ranjan Mathai

by danfes, agency

“Regional integration is not only important, but an imperative if we want to realize shared goals and face shared challenges,” said Ranjan Mathai, Foreign Secretary, Ministry of External Affairs, in his inaugural address at the ‘Driving South Asia Economic Integration’ conference, organized by CII.

The countries in the region, he elaborated, are marked by great commonalities as well as diversity, face the same challenges of poverty and development and share the same goals and aspirations of a developing region with a sizeable young population. Regional cooperation therefore assumes greater significance, and regional associations such as SAARC play an important role in taking forward growth plans. He spoke of the need to identify and address the economic challenges and said we need to address trade imbalances that exist, among other measures. India, he said, has taken several steps to improve political and economic ties in the region, mentioning the SAFTA Ministerial Council Meetings, the SAARC Chambers of Commerce and Industry, SAARC Trade Fairs – all of which work towards the economic and social advancement of the region. A major initiative in this direction, he said was the SAARC Development Fund, which focuses on the social, economic and infrastructure development of the region.

Currently, projects under the social arm are underway. He also spoke of the steps taken to improve ties with neighbouring countries Pakistan and Bangladesh, saying India had accorded Most Favoured Nation (MFN) status to Pakistan and Indian companies such as Airtel and Arvind Mills are investing in Bangladesh. “India’s prosperity is interlinked to that of its neighbours,” he said.

Delivering the keynote address, Nagesh Kumar, Director ESCAP South and SW Asia & Chief Economist, UN-ESCAP said that all across the world, people are looking at regional cooperation in the face of challenges due to the continuing global economic turmoil. He said it was important to reassess and find a way forward because even after the economic turmoil settles, a new economic reality will present itself to the world.

Earlier, in his welcome address, Ajay S Shriram, Vice President, CII, and Chairman and Senior Managing Director, DC Shriram Consolidated Ltd, said that while South Asia has shown remarkable resilience in the face of the recent global financial crisis, the continuing global economic turmoil and recent developments in the region, especially new growth momentum and greater openness in all South Asian economies, warrant a fresh look at enhancing regional integration. While the opportunities are immense, he stressed on the need to address areas of concern such as South Asia’s high transaction cost for inter-regional trade, compared to other regions in the world. Non-tariff and para-tariff measures also major impediments which are responsible not only for low level of intra-regional trade, but also for low share of SAARC in global trade. Potential gains from the South Asian Free Trade Area (SAFTA) have tended to remain largely untapped.

Intra-South Asia trade stands at much lower level (5%), in comparison to intra-PTA trade being 70% for the EU; 49% for NAFTA and 25% for ASEAN. The time was therefore ripe to deliberate upon ways and means to realize the potential that the region offers by improving connectivity and strengthening ties.

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Oct 16-31, 2016 Issue
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