DR.

RAM MANOHAR LOHIA NATIONAL

LAW UNIVERSITY, LUCKNOW

POLITICAL SCIENCE
FINAL DRAFT

TOPIC: SOUTH ASIAN ASSOCIATION FOR

REGIONAL COOPERATION

Submitted to- Submitted by-

Ms. Monika Shrivastava Tulika Gupta

Assistant Professor of Political Science, Roll no.-180101150

Dr. Ram Manohar Lohia National law B.A.LL.B. (Hons.) 1st year

University, Lucknow 1st semester

 ACKNOWLEDGEMENT

“Words can never convey what deeds have done.”

Writing a project is never a single man’s job. I am overwhelmed in all humbleness and
grateful to acknowledge my depth to all those who have helped me to put ideas, well above
the level of simplicity and into something concrete.

I am very thankful to my political science professor Ms. Monika Shrivastava for her valuable
help. She was always there to show the right track when I needed her help. With the help of
her valuable suggestions, guidance and encouragement, I was able to complete this project. I
would also like to thank my friends, who often helped and gave me support at critical
junctures during the making of this project.

I hope you will appreciate the hard work that I have put in this project.
 TABLE OF CONTENTS

INRODUCTION

HISTORY

PRICIPLES AND OBJECTIVES

FINANCIAL ARRAGEMENT IN SAARC

TRADE AND ECONOMIC COOPERATION

REGIONAL CONVENTIONAL AGREEMENTS

CONCLUSION

REFERENCES
 INTODUCTION

The South Asian Association for Regional Cooperation (SAARC) is an organisation of South
Asian nations, which was established on 8 December 1985 when the government of
Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan, and Sri Lanka formally adopted its
charter providing for the promotion of economic and social progress, cultural development
within the South Asia region and also for friendship and cooperation with other developing
countries. It is dedicated to economic, technological, social, and cultural development
emphasising collective self-reliance. Its seven founding members are Sri Lanka, Bhutan,
India, Maldives, Nepal, Pakistan, and Bangladesh. Afghanistan joined the organization in
2007. Meetings of heads of state are usually scheduled annually; meetings of foreign
secretaries, twice annually. It is headquartered in Kathmandu, Nepal.

Area of operation of SAARC nations are Agriculture and Rural Development Health and
Population Activities Women, Youth and Children Transportation Environment and Forestry
Science and Technology and Meteorology Human Resources Development.
 HISTORY

The first concrete proposal for establishing a framework for regional cooperation in South
Asia was made by the late president of Bangladesh, Ziaur Rahman, on May 2, 1980. Prior to
this, the idea of regional cooperation in South Asia was discussed in at least three
conferences: the Asian Relations Conference in New Delhi in April 1947, the Baguio
Conference in the Philippines in May 1950, and the Colombo Powers Conference in April
1954. In the late 1970s, SAARC nations agreed upon the creation of a trade bloc consisting of
South Asian countries. The idea of regional cooperation in South Asia was again mooted in
May 1980. The foreign secretaries of the seven countries met for the first time in Colombo in
April 1981. The Committee of the Whole, which met in Colombo in August 1985, identified
five broad areas for regional cooperation. New areas of cooperation were added in the
following years.

Afghanistan was added to the regional grouping on 13 November 2005. With the addition of
Afghanistan, the total number of member states were raised to eight (8). In April 2006, the
United States of America and South Korea made formal requests to be granted observer
status. The European Union has also indicated interest in being given observer status and
made a formal request for the same to the SAARC Council of Ministers meeting in July
2006. On 2 August 2006 the foreign ministers of the SAARC countries agreed in principle to
grant observer status to the US, South Korea and the European Union. On 4 March 2008, Iran
requested observer status. Followed shortly by the entrance of Mauritius.
 PRINCIPLES AND OBJECTIVES

PRICIPLES

The principles are:

 Respect for sovereignty, territorial integrity, political equality and independence of all
members states
 Non-interference in the internal matters is one of its objectives
 Cooperation for mutual benefit
 All decisions to be taken unanimously and need a quorum of all eight members
 All bilateral issues to be kept aside and only multilateral (involving many countries)
Issues to be discussed without being prejudiced by bilateral issues

OBJECTIVES

The objectives of the Association as defined in the Charter are:

 To promote the welfare of the people of South Asia and to improve their quality of
life;
 To accelerate economic growth, social progress and cultural development in the
region and to provide all individuals the opportunity to live in dignity and to realize
their full potential;
 To promote and strengthen selective self-reliance among the countries of South Asia;
 To contribute to mutual trust, understanding and appreciation of one another's
problems;
 To promote active collaboration and mutual assistance in the economic, social,
cultural, technical and scientific fields;
 To strengthen cooperation with other developing countries;
 To strengthen cooperation among themselves in international forums on matters of
common interest; and
 To cooperate with international and regional organisations with similar aims and
purposes.
 FINANCIAL ARRANGEMENTS IN SAARC

The member states contribute the balance according to an agreed formula, while the host
country pays a minimum balance. For example, in 1993, when the building of secretariat was
under construction the host country paid the 40% of the balance and the rest of the balance
was shared according to the agreed formula.

TRADE AND ECONOMIC COOPERATION

SAARC has taken important steps to expand in the core economic areas among the member
countries. The council of ministers endorsed the study and decided to set up high level
committee on (CEC) committee on economics cooperation on the ninth session in July 1991
in Malaysia. At the summit meeting in Colombo in December 1991, the head of states of the
member countries approved the establishment of (IGG) to seek agreements on an institutional
framework under which trade liberation among its members. In the four meetings of IGG, in
the negotiations among the member states exchanged the concessions to be offered/sought.
The council of ministers at its 15th meeting session agreed that the full and timely realization
of the benefits of regional economic cooperation required.

(a)the implementation of other related measures such as the removal of Para-tariff, non-tariff
and other trade control barriers within the specific timeframes and

(b)eventual progression to the creation of a free-trade area in the region. The head of state or
govt. at the 8th summit meeting in Delhi 1995 aid that the first round of trade under SAPTA
has been completed. CEC at its 6th summit meeting in 1995 in Delhi recommended that with
the operationalisation of SAARC (SAPTA), it is now desirable to work toward removal of
para-tariff and non-tariff barriers widening and deepening the tariff cuts and expanding the
list of products to be included for intra-SAARC preferential trade under SAPTA. It
recommended that to push the SAPTA process forward, the IGG on trade Liberalization be
call together to conduct the 2nd round of trade negotiations under SAPTA and proposed that
the 1stmeeting of the 2nd round can take place in 1996.

The following fields have also been taken toward promoting trade cooperation within the
region:

 Cooperation in the field of Handicrafts and Cottage Industries

 Study on Transport Infrastructure and Transit Facilities
 SAARC Chamber of Commerce and Industry (SCCI)

SCCI was recognized in December 1992 by SAARC. The headquarters are established at
Karachi and the national units in all seven countries. First president of SCCI was MR. S.M
Inam. SCCI will act as a dynamic instrument of promoting regional cooperation in the area of
trade and economic relations.

The SAARC Chamber has been instrumental in disseminating the information about the
content, scope, and potential of the Framework Agreement on SAARC (SAPTA) among the
business community in the region. It has organized its aegis, various seminars on SAPTA in
the member countries for this purpose. In December 1994 a regional seminar on SAPTA was
organized in Katmandu by Federation of Nepalese Chambers of Commerce and Industry in
cooperation with the SAARC Chamber of Commerce and Industry and Friedrich-Naumann-
Stiftung.

The delegations of SCCI, headed by their president and comprising representatives of the
national Federations of Chambers of Commerce and Industry of SAARC Member States,
they have visited Germany and Japan for expanding the exports from the SAARC region to
the EU and Japan.

To expand the activities of the SCCI in the field of promoting trade both within and outside
the region of SAARC, has decide to its recognition to SCCI for a period of 5 years.

In October 1995 Mr. Salman F. Rahman was elected the president of SCCI.

REGIONAL CONVENTIONS/AGREEMENTS

Agreement on Establishing the SAARC Food Security Reserve (SFSR)

In 1987 Katmandu, during the 3rd summit meeting of SAARC, an agreement was signed on
establishing the SAARC food security reserve. An agreement came into force on 12 August
1988, provided for a reserve of food grains for the emergency use. The reserve’s size is
241580 tones.

The member countries of the food reserve board meet once a year. The main function of this
board is to take review of the assestment of the situation of food like production,
consumption, trade, prices, quality and stocks of food grains.
SAFTA (South Asian free trade Agreement):

On January 6 2004, the SAARC member countries signed the agreement on SAFTA, their
aim was to create a free trade zone about 1.5 billion people.

The SAFTA requires the three developing countries in South Asia (India, Pakistan and Sri
Lanka) to bring their duties to zero by 2012 in a series of annual cuts. The LCDs of South
Asia consisting of Nepal, Bhutan, Bangladesh and the Maldives have an additional three
years to reduce tariffs to zero.

It's need for the SAARC to make the SAFTA more effective considering the fact that inter-
trade among SAARC countries now accounts for only about 5% of the members' total trade,
while the figure for the EU is 55% and the NAFTA (North America Free Trade Area) is 61
%.

Agreement on SAARC Preferential Trading Arrangement (SAPTA):

On 11 April 1993 during the seventh summit meeting of SAARC the agreement on SAPTA
was signed by the member states.

During the 6th summit meeting the initiative was taken to establish the SAPTA in December
1991. This agreement provides step by step liberalization of intra-regional trade... It considers
the periodic rounds of trade negotiations for exchange of trade concessions on tariff, Para-
tariff and non-tariff measures.

In SAARC region the SAPTA provide the special and favorable treatment to LDCs.
Provisions for safeguard actions and BOP are also incorporated in agreement to protect the
interest of the member states during critical economic circumstances.

An IGG on Trade Liberalization completed the 1st round of trade negotiations at its 6th
summit Meeting held at the SAARC Secretariat, Katmandu on 20-21 April 1995. It finalized
the Consolidated National Schedules of Concessions which were approved by the 5th Session
of the Council of Ministers held on 30 April - 1 May 1995 in New Delhi. The SAPTA
Agreement has since been by Member States and will enter into force on 7th December 1995.
The Committee of Participants has since been established and will meet in the third quarter of
1996 to review the progress in the implementation of the SAPTA Agreement.
FUTURE OF SAARC:

The future of SAARC seems to have been vanished. The reason is that the culture of the
member countries is not same, the people to people contact is very limited and major reason
is India’s attitude towards the member countries. The reason is that the relations between the
member countries is not good, the don’t cooperate with each other and the main reason is
India.

Why SAARC has been a failure?

1). Clash of civilizations:

Prof. Samuel Huntington has mentioned in his book “the clash of civilizations” that SAARC
has been a failure because according to him the countries that belong to associations like EU
etc. they belong to same culture but SAARC belongs to those countries whose cultures are
different. India and Pakistan are foes of each other, they fight on pity things, and then how
can these two countries help each other in one association……. The one country does not
have feeling of belonging with the other area or state.

2). People to people contact:

The contact of the people with the association is zero and as well as with the people of the
member countries they don’t know when was the association made and that was the purpose
then how can they join together to help their own state solve their problem.

3). Pathetic condition of the south Asia:

260 million inhabitants of the south Asia lack basic facilities in south Asia and it the most
deprived region too. 337 million people lack safe drinking water: 830 million are without
rudimentary sanitation and 400 million go hungry every day. SAARC is the most militarized
place in world; its two countries Pakistan and India are spending $ 30 billion on their defense
expense. Afghanistan, it’s newly member is facing war from last 30 years. In view of these
all major problems how such association cans can successfully work.

4). Trade:
All the south Asian countries look up to India to share its huge markets because of its size
and location, where 80% of the of the intra-regional trade in south Asia is to or from India.
India blames the failure of SAFTA on Pakistan but it is not true at all because SAFTA
requires India, Pakistan and Sri Lanka to bring their duties down to 20% in the two-year
period ending in 2007.

The 20% duty in the final phase ending in 2012 will be reduced to zero.

During the fiscal period of 2006-2007, the exports of India were in billion dollars but their
imports were no more than $350 million. This shows that that how one country wants to put
the others duty to 0.

5). Different Political system:

The different kind of politics in the member states is also the reason of the failure of SAARC.
In south Asia their hadn’t been a strong democratic region. Like in India there is democracy,
in Pakistan there is transitional democracy, kingship in Nepal and presidential system in
Sri Lanka.

The most countries have remained unstable in the past and the future. The dispute between
the two countries India and Pakistan over Kashmir issue has never let these two giant
countries of the south Asia to go along well and set aside their differences on the SAARC
forum.

A part from this the India has dome disputes with its rest of the member countries like
Pakistan, Bangladesh, Nepal, Bhutan, and this thing also hasn’t helped SAARC cause.

CONCLUSION

SAARC is the weakest regional organization of the world its population is 1.5 billion, its
problems are numerous and they demand urgent solution. The bigger countries should look
after the LDCs. the goals should be made realistic, so that they can easily be achieved.
 REFERENCES

Books:

Author: Pierre Philippe combes. Economic Geography the Integration of Regions

and Nations Publisher: Princeton University Press (September 8, 2008).

Websites:

http://www.preservearticles.com

http://archives.dawn.com/archives/67400

http://www.saarc-sec.org

http://www.thedailystar.net/newDesign/news-details.php?nid=208701