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Time for hope

The New Year has come with renewed hopes of peace and harmony in the troubled South Asian region that we live in.

india Updated: Jan 02, 2006 01:54 IST

The New Year has come with renewed hopes of peace and harmony in the troubled South Asian region that we live in. As of January 1, the agreement on a South Asian Free Trade Area (Safta) comes into force. Hope is, of course, the theme of every new year. But the first faltering steps towards opening the region for free trade in goods is not just about wishes, but practical steps to make life better for a region that houses the largest number of poor people in the world. The agreement is aimed at creating a single market in the region, and then a possible economic union. Underlying the expectations is an awareness that South Asia is a single geo-economic region and economic growth across the region must be meaningful.

Can the dynamics of globalisation persuade South Asian States to eliminate the many real obstacles that remain in their path before the benefits of Safta or a putative economic union kick in? India, the largest country in the region and its most sophisticated economy, has the most to gain from the success of Safta. It also has the greatest responsibility in ensuring that it works. To that end, New Delhi has been generous with its neighbours, especially Bangladesh and Maldives, offering concessions beyond the ambit of the treaty. Countries like Pakistan and Sri Lanka are yet to ratify the pact, but India has announced that it will go ahead and cut customs duties of goods originating in Saarc countries by 5 per cent immediately. The better-off States have seven years to meet this target, while the poorer ones can take ten. While all countries can maintain a list of sensitive products on which tariffs will not be reduced, the credibility of the exercise will be moot if these lists are too lengthy.

There are unstated expectations that the process of economic integration will lead to the reduction of political tensions in South Asia. But today’s perspective — the rise of religious fundamentalism in Bangladesh, the Nepalese civil war, Pakistan’s continuing patronage of terrorists — would probably suggest that the prospects are bleak. But then this is the beginning of a new year and hope must be allowed to triumph over past experience.

First Published: Jan 02, 2006 01:54 IST