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PUBLISHED BY
South Asia Watch on Trade,Economics & Environment (SAWTEE)
REGIONAL ADVISORY BOARD
Bangladesh
Dr. Debapriya Bhattacharya
India
Dr. Veena Jha
Nepal
Dr. Posh Raj Pandey
Pakistan
Dr. Abid Qaiyum Suleri
Sri Lanka
Dr. Saman Kelegama
EDITOR-IN-CHIEF
Ratnakar Adhikari
EDITOR
Kamalesh Adhikari
EXECUTIVE EDITOR
Paras Kharel
DESIGN
Effect, 4433703
ILLUSTRATION & COVER
Abin Shrestha
PRINTED AT
Modern Printing PressKathmandu
P.O. Box: 19366254 Lamtangeen MargBaluwatar, Kathmandu, NepalTel: 977-1-4415824/4444438Fax: 977-1-4444570E-mail: sawtee@sawtee.orgWeb: www.sawtee.org
PUBLISHED WITH SUPPORT FROM
  e   d   i   t  o  r  s   ’   n  o   t  e
 June-July 2009
Tackling the global crisis
THE“decoupling” hypothesis has proved wrong. The financial crisisthat erupted in September 2008 in the US quickly spilled over to the realsector and transformed into an “economic crisis” of a global scale notseen since the 1930s. South Asia, which benefited from its impressiveintegration with the world economy over the last two decades, is beinghit by external shocks stemming from the crisis. Its economies are slow-ing down. Exports, remittances and foreign capital flows are under strainand the resultant micro-level impacts are alarming. For example, as theUN reports, a significant number of workers, mostly female, in garmentfactories in Bangladesh and Sri Lanka, diamond cutters in India, andoverseas migrant workers from the region are all bearing the brunt of thecrisis and facing severe human development challenges. The social di-mensions of the crisis are already evident in reduced household income,increased unemployment and underemployment, and adverse impactson education, health, etc. All these are a recipe for social strife and, inparticular, endanger progress towards the MDGs. So much so that thesubstantial progress made in income poverty reduction is being reversed.South Asia is paying for the sins committed by “others”.Mitigating the impacts of the crisis calls for the extension and imple-mentation of targeted social security programmes, for example, those re-lating to income and employment generation, and food security. Effectivepolicy reforms and increased spending to shore up the economies arealso critical. Substantial fiscal stimulus packages are required, but SouthAsian governments may not have the leverage for such stimulus spend-ing. Monetary policy too has its limitations. Hence, there has to be a great-er amount of external assistance and cooperation. Collectively, SouthAsian governments should seek assistance from SAARC observers—Aus-tralia, China, the EU, Japan, South Korea and the US. However, suchassistance and cooperation need to be supported by productive use andmanagement of aid, foreign direct investment and other resource flowssuch as remittance.The external assistance and cooperation also need a special focus onhow to strengthen and streamline the multilateral trade reform agendaand ensure better trade conditions for South Asian countries. The DohaRound of trade negotiations under the WTO has a major role to play inthis regard. Increased market access, effective operationalization of theaid-for-trade initiative, and the liberalization of services trade underMode 4 (temporary movement of natural persons) are essential. If themultilateral trading system fails to represent a global public good insubstance, together with many other developing and least-developedcountries, South Asia will continue to remain vulnerable to externalshocks, including those generated by the global economic crisis.Similarly, within the region, South Asian countries should addresstheir supply-side constraints to trade. While lack of export diversifica-tion and capacity to export enhances the severity of external shocks,addressing supply-side constraints is crucial for export diversificationand the mitigation of the impacts of future crises. They can promoteSouth-South cooperation, and also intensify regional trade and economicintegration, as they are still more integrated with the rest of the worldthan with each other. Deeper regional integration will help cushion theimpacts of crises as well as promote their collective development inter-ests. The inclusion of services and investment issues within the Agree-ment on South Asian Free Trade Area and bringing down existing trade barriers are essential.However, all these efforts of South Asian countries will not achievethe desired goals if they are not complemented by substantial reforms inglobal economic governance architecture.
 
Can the multilateral trading system be considered a global publicgood when the WTO lacks legitimacy and is plagued withdemocratic deficit?
Contents
TradeInsight
 
•
Vol. 5, No. 2, 2009
MULTILATERAL TRADE DEBATE 11FARMERS’ RIGHTS 33
Views expressed in
Trade Insight 
are of the authors and editors and do not necessarilyreflect the official position of SAWTEE or its member institutions.
CLIMATE CHANGE4TRADE WINDS5ECONOMIC NEWS7ECONOMIC GOVERNANCE8The Global Crisis and the WTOECONOMIC CRISIS:COUNTRY CASE STUDIESReadymade Garments inBangladesh18Business ProcessOutsourcing in India21Remittance in Nepal24Foreign Direct Investmentin Pakistan26Tourism in Sri Lanka28TECHNOLOGY TRANSFER31Climate Change, TechnologyTransfer and South AsiaUNDERSTANDING WTO36Anti-Dumping AgreementBOOK REVIEW38Return of Depression EconomicsNETWORK NEWS 39
BANGLADESH
1.Bangladesh Environmental Lawyers’Association (BELA), Dhaka2.Unnayan Shamannay, Dhaka
INDIA
1.Citizen consumer and civic Action Group(CAG), Chennai2.Consumer Unity & Trust Society (CUTS),Jaipur3.Development Research and Action Group(DRAG), New Delhi
NEPAL
1.Society for Legal and EnvironmentalAnalysis and Development Research(LEADERS), Kathmandu2.Forum for Protection of Public Interest(Pro Public), Kathmandu
PAKISTAN
1.Journalists for Democracy and HumanRights (JDHR), Islamabad2.Sustainable Development Policy Institute(SDPI), Islamabad
SRI LANKA
1.Institute of Policy Studies (IPS),Colombo2.Law & Society Trust (LST), Colombo
SAWTEE NETWORK
COVER FEATURE 12
Implications forSouth Asia
GlobalEconomicCrisis
Is the WTO a
global public good ?
Realization of
Farmers’ Rights
Does the new resolution onfarmers’ rights hold anysignificance without globalsupport for its implementation?
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