The 18th Saarc summit concluded in Kathmandu with the signing of a framework agreement on energy cooperation and the adoption of a declaration that keeps hopes alive that the regional body will move on, albeit at a snail’s pace.
The last-minute deal on electricity salvaged the Kathmandu Summit which appeared headed for a blank as Indian Prime Minister Narendra Modi and his Pakistan counterpart cold-shouldered each other on the opening day. The deal is an important one for Saarc leaders to showcase their achievement this time around, and also sets the stage for electricity trading, identified as one of the three vehicles critical to ensure “deeper connectivity for peace and prosperity”.
The run-up to the sign-off on the energy agreement and the declaration was a bit tense, though. Understandably, there was a clash of interests between India and Pakistan: the former pushing for more intra-regional cooperation while the latter advocated an increased role for two of the nine observers — China and South Korea.
This created a virtual stand-off between Saarc’s two biggest members, which together fund more than 50% of the association’s operational costs. Such a stance not only created prolonged suspense about the outcome, it also sent the message across that Pakistan was trying to scupper the proposals for closer regional cooperation. By appearing to have come in the way of the three agreements that had by and large been finalised, Pakistan only isolated itself from the rest, including host Nepal. In the end, it was the rest of Saarc vs Pakistan but the remaining seven succeeded in “persuading” the Islamic Republic to stand shoulder to shoulder in the broader interests of regional cooperation. Pakistan, however, got a bit of what it wanted as well since the Saarc leaders agreed “to engage the Saarc observers into productive, demand-driven and objective project based cooperation in priority areas as identified by the member states”.
This means that China, already making investment inroads into South Asia, could have a greater role and say in the region in the days ahead as compared to other observers, including the United States and European Union.
There is, however, a caveat. In the years ahead, if Pakistan continues to play the China-Korea card in the Saarc forum the risk is that one of the founding members of Saarc will be left out of the entire process. The reason: New Delhi only gets the opportunity to push through a sub-regional approach to Saarc and will rise to the occasion to ink more bilateral deals with its neighbours in the east — Nepal, Bhutan and Bangladesh — and beyond. Should Saarc fail to move ahead as a block of all eight member states, this could give rise to sub-regional approaches to achieve economic growth in the region, which in turn could be the beginning of an end to the Saarc process.
By the look of things, the Saarc member states are already alive to such risks. The host and its most important immediate neighbour made the most out of the Saarc summit on the sidelines as, within a couple of hours after Modi touched down in Kathmandu on November 25, Nepal and India signed as many as 10 bilateral deals. Key among them were the signing of an MoU on the development of the export-oriented 900 -MW Arun-III hydro-electric project, extension of $1 billion credit that Modi had pledged in the course of his visit to Nepal in early August and the operation of passenger bus services between cities of Nepal and India.
These indicate that the confidence level between Kathmandu and New Delhi continues to remain at an all-time high even as Modi offered surprise advice to Nepal’s political leaders, who are vertically divided over the contents of a new Constitution in the making. He told political parties to adopt the Constitution by consensus, implicitly supporting the opposition parties composed of Madhesis and the Maoists. A Constitution promulgated on the basis of numerical strength in the parliament would not serve Nepal’s long-term interests, he said while handing over a trauma centre built with Indian assistance in the heart of Kathmandu. While that statement has not gone down well in the Nepali Congress and CPN-UML, the leaders from the ruling coalition have “consciously refrained from making unpleasant comments”.
That shows Nepal has been caught up in the Modi wave and the Indian Prime Minister put himself to the test yet again while returning to the hotel after Saarc’s concluding session. The unpredictable, the rather unstoppable Modi stopped at Kalimati, hopped out of his car and shook hands with some and waved to Kathmandu residents watching the motorcades of Saarc leaders whiz past them at the end of the summit. That was a testimony to the fact that he has charmed and won the hearts and minds of Nepalis.
Now that the Summit is over, the focus shifts to developments in the next three months. Saarc heads of governments gave their transport ministers a 90-day timeline to finalise two other important framework agreements—Saarc Motor Vehicles Agreement for the Regulation of Passenger and Cargo Vehicular Traffic and Saarc Regional Agreement on Railways — for approval during the 19th summit, due in Islamabad in 2016. These deals are intended, and expected, to go a long way in boosting increased regional connectivity within South Asia, home to one-fifth of humanity and yet one of the least connected regions of the world. Even if these two extremely important agreements are to be adopted during the 2016 Summit, the process of deeper regional integration has already been delayed by a couple of years. For now, Nepal hosted the Summit successfully and, together with India, made the most out of it on the sidelines.
(Prakash Rimal is Editor of The Himalayan Times, Nepal. The views expressed by the author are personal)