A few hours before Narendra Modi was to arrive in Kathmandu on Tuesday afternoon for the eighteenth South Asian Association for Regional Cooperation (Saarc) summit, held on November 26 and 27, two diplomats from a smaller state in the region were having a conversation in the lobby of Soaltee Hotel. The foreign ministers of the eight countries which make up Saarc had met that day in the MeghMalhar hall next door in the same hotel. They had been unable to agree on three pacts which had been proposed for this summit – which would enhance road and rail connectivity and bring about a framework for energy cooperation. Pakistan had objected, and Saarc – which operates on consensus – could do little.
One diplomat rued, “Saarc has not been able to do much for 30 years. And it won’t for the next 30 if we behave like this. For one, this India-Pakistan tension always casts a shadow. And two, it is a bureaucratic maze and we move too incrementally, and stick to routine and safe issues.” The other nodded, but said this meeting could be different. “Modi is the new element this time. Let us see if ache din (better times) are in the offing for Saarc,” he said, playing on Modi’s campaign slogan in India, promising good times.
Modi had made it clear that neighbours came first for him. His invitation to Saarc leaders for his swearing-in; his successful visits to Bhutan and Nepal; his government’s close engagement with Bangladesh especially on security issues had all been concrete signals of this commitment. If there had been one dampener in the broader South Asian bonhomie though, it was the cancellation of the foreign secretary talks with Pakistan, and heavy cross-border shelling. As one of the diplomats in the hotel that day put it, “We know he is interested in South Asia. But will Modi prefer the bilateral route with neighbours he can do business with or will he invest in multilateralism?”
It was as if the Prime Minister (PM) sensed the mood, for he noted in his policy statement at the Saarc inaugural that the association evoked cynicism and scepticism. This cynicism was well justified, for pick any indicator – living standards of their citizens, education, health, employment – and the countries would come out looking dismal. Instead of working together and synergising their strengths, the region remained the least integrated and connected in the world.
As Modi said, less than 5% of the global trade happened among Saarc nations; less than one per cent of Indian investment was in South Asian countries; it was harder to travel within the region than to Bangkok or Singapore; goods travelled from one Punjab to another Punjab (in India and Pakistan) via Delhi, Mumbai, Dubai and Karachi ‘making the journey eleven times longer and the cost four times more’. The list is endless – some countries in the region have huge energy resources while others are starving and need power for growth; the visa regime is almost draconian between some of the countries; millions live on the borderlands and frontiers of these countries yet are unable to forge bonds, visit each other, or use comparative advantages for growth. Reviving and energising Saarc is important precisely to get rid of these artificial barriers.
By recognising that there was an obvious problem, Modi did the right thing. But in the opinion of most other members, a large part of the onus is on India. Not only is it the biggest country in the region, it is economically the strongest. The asymmetry between India and the rest has long been noted by Saarc observers. It also shares borders with each South Asian state (barring Afghanistan) even though most of these states don’t share borders with each other.
MODI COURTS NEIGHBOURS, SHARIF SULKS
There were some refreshing Indian announcements – from longer term business visas to Saarc satellite; from announcing the intent to set up a Special Purposes Facility to finance infrastructure projects in the region to recognising that India’s trade surplus with the rest of the region was an issue. But it did not go as far as some had hoped. Shyam Saran, the chairman of the National Security Advisory Board, had recommended on the pages of the Hindustan Times that India should open up its markets without ifs and buts; extend national treatment and transit to cargo for all states and visa on arrival and electronic visa clearance facilities.
But Indian unilateralism can only be one element of the Saarc process, as was evident during the summit. Simpler agreements – which had emerged from meetings of designated ministers and secretaries of each country – were blocked by Pakistan, citing pending internal processes. Pakistan’s Prime Minister Nawaz Sharif was clearly sulking, miffed with Modi for having cancelled the foreign secretary talks which had weakened his standing considerably within his country.
But Pakistan’s approach seemed myopic, even if Sharif felt Modi had not reciprocated his warm gesture of coming for the swearing-in and been hostile. India was not enormously invested in seeing the agreements through. As Indian officials candidly said, Delhi already had bilateral connectivity and energy agreements with several countries. But the Indian camp was pretty delighted at Islamabad looking like the spoiler, alienating the other smaller states too.
Eventually, better sense seems to have prevailed. And Pakistan gave the green signal for the Saarc Framework Agreement for Energy Co-operation (Electricity), which would, in principle, enable power trading between the different member states. Two other pacts – Saarc Motor Vehicles Agreement for the Regulation of Passenger and Cargo Vehicular Traffic, and Saarc Regional Agreement on Railways – remain pending, with a commitment that it would be signed in three months.
EYE ON GROWTH - WITH OR WITHOUT ISLAMABAD
It was with an eye on this tendency that Modi made a significant statement during his address. He said regional bonds will grow, ‘through Saarc or outside it, among us all or some of us’. He also enumerated the progress in bilateral ties with countries. The message to Islamabad was unmistakable. India would be happy to work within the Saarc mechanism, but it would be equally happy to work bilaterally with each country – or with a smaller group of countries.
This fit in with what a BJP spokesperson had told Hindustan Times some time back in Delhi. “South Asia will grow without Pakistan if they don’t want to be on board. They anyway see themselves as a part of the Islamic West Asian world; good luck to them.”
But diplomats from other states were uncomfortable with the implications of Modi’s message. One official from a smaller state said, “As sovereign states, we are entitled to deepen bilateral ties. That is our right. But in a multilateral framework, it is best not to say this.” He added that Pakistan cannot be ignored. “We cannot defy geography. How will states deepen connectivity with Afghanistan without Pakistan?” But an Indian official at the summit defended the approach, saying the message had hit home, as Pakistan eventually came around to agreeing to the energy pact. “The idea is to tell everyone we are serious and we will move forward.”
OF INDO-PAK TIES AND ITS IMPACT ON FUTURE OF SAARC
And therein lies the big problem with Saarc. The Modi-Sharif handshake – and whether it would happen or not – may have been the centre of the media’s attention. But the lack of comfort between the two states has direct implications for the larger grouping. Pakistan is to host the next summit, and when it happens is directly contingent on the state of India-Pakistan ties for it would mean Modi paying a visit to Islamabad.
The Kathmandu declaration issued at the end of the summit is forward looking, with a strong emphasis on deepening integration and connectivity. Hindustan Times went back to the diplomat who had sounded cynical before the start of the summit to ask what he made of it, and he replied, “I have seen many declarations. The challenge is always implementation.” The fact that Saarc exists is a positive, but it has a long way to go to be taken seriously.