So that Pakistan ceases to matter

At the Saarc summit in Kathmandu in 2003, the heads of government proclaimed: “To give effect to the shared aspirations for a more prosperous South Asia, the (Saarc) leaders agreed on the vision of a phased and planned process, eventually leading to a South Asian Economic Union.”

India’s regional economic integration has been far slower in South Asia than what has transpired in its relations with Asean, with whom India has concluded free trade agreements (FTAs) in both goods and services.

Moreover, India has concluded comprehensive economic cooperation agreements, going well beyond an FTA, with Japan and South Korea. Despite the conclusion of a Saarc FTA, Pakistan has placed crippling trade restrictions on Indian exports and made a farce of pious declarations to establish an economic union in South Asia. There is no realistic reason to believe this will change in the foreseeable future.

Pakistan’s determination to torpedo South Asian regional cooperation was starkly manifested in its opposition to India’s proposal for launching a satellite for exclusive use by Saarc members. Mercifully, the enthusiasm shown by other members forced Pakistan to eventually fall in line.

Apart from trade, there are two other crucial features that accelerate regional cooperation —connectivity and energy cooperation, including interlinking of electricity grids. The 2014 Saarc summit in Kathmandu spoke of increasing regional cooperation in areas ranging from connectivity and energy, to terrorism and telecommunications.

Obviously, Pakistan has no intention of expanding cooperation in any of these areas. It blocks road connectivity between India and Afghanistan. Despite facing severe power shortages, it has rejected offers from India to supply electricity. It sends the likes of Ajmal Kasab to engage in terrorism in India and provides a haven to the likes of Dawood Ebrahim and Zakiur Rehman Lakhvi.

New Delhi has now moved ahead on measures that will promote regional cooperation, bypassing Pakistan. Connectivity with Afghanistan is now being sought through the Iranian port of Chahbahar.

At a recent ministerial meeting in Bhutan, the transport ministers of India, Nepal, Bhutan and Bangladesh concluded a significant motor vehicle agreement, laying the framework for seamless movement of passenger, personal and cargo vehicular traffic among these countries. Transport Minister Nitin Gadkari said the agreement would “allow motor vehicles of all categories in our countries to move freely in our region”.

India and its eastern neighbours envisage a massive project, including 30 priority transport connectivity corridors, requiring investment of around $8 billion. Initial estimates suggest that such corridors could potentially increase sub-regional trade by 60 per cent. The Asian Development Bank has expressed interest in funding such projects.

It remains to be seen if the Asian Infrastructure Investment Bank (AIIB) will adopt a similarly positive approach. As relations with Bangladesh improve, the prospects for land and maritime connectivity with our north-eastern States, through Bangladesh, appear increasingly bright.

The prospects for energy cooperation with our eastern neighbours are immense. Efforts made over the past year have helped create an environment to tap into Nepal’s vast hydro-electric potential of 83,000 MW. Barely 600 MW of this potential is now being utilised. While independent Indian power producers from the private sector are in the process of negotiating agreements to generate around 11,000 MW, delays could arise because of political uncertainties in Nepal.

Similar considerations could cause delays in major inter-governmental projects such as the 5,600-MW Pancheshwar multipurpose project. Grid connectivity between India and Nepal is also set to expand. At the same, time hydro-electric projects in Bhutan are being expeditiously completed, with a target of 30,000 MW by 2030.

The prospects for developing an eastern electricity grid linking India, Nepal, Bhutan, and Bangladesh are bright, as grid connections have also been established between Bangladesh, and Tripura and West Bengal. India will supply Bangladesh 1,100 MW of power from West Bengal and Tripura by the end of this year.

Moreover, implementation has already begun on a 1,320-MW thermal power station in Bangladesh, at an estimated cost of $1.2 billion. The project is being executed by a JV of India’s public sector National Thermal Power Corporation and the Bangladesh Power Development Board.

Arunachal Pradesh has huge hydroelectric potential. The State government is seeking to conclude agreements for some 42 hydroelectric projects with an estimated capacity of 27,000 MW.

Construction on the Upper Salang hydroelectric project with an estimated capacity of 12,000 MW has commenced. Hopefully, environmental challenges to these projects will be expeditiously addressed.

India is planning to take forward its proposals for land connectivity agreed to in Bhutan, by fashioning a similar agreement with Myanmar and Thailand, by December 2015.

A proposal to provide road connectivity to Sri Lanka through a bridge and an underwater tunnel is under consideration. This would complete an ambitious programme for a trans-Asian road and transport network across the Bay of Bengal. Project financing from the ADB, which will be competing with the AIIB, could be considered.

New bus services were inaugurated and made operational during the visit of Prime Minister Narendra Modi to Nepal and Bangladesh. There are also proposals under consideration for an India-Sri Lanka high voltage DC grid, linking either Madurai or Tuticorin in Tamil Nadu, with Anuradhapura or Puttalam in Sri Lanka.

We could then see an electricity grid linking India, Nepal, Bhutan, Bangladesh, Sri Lanka, Myanmar and Thailand — all members of BIMSTEC (Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation). This would be akin to the North American electricity grid, linking the US, Canada and Mexico.

In these circumstances, New Delhi should recognise that the only realistic route to economic integration in its neighbourhood lies primarily on the east, along and across the Bay of Bengal.

Structures other than Saarc need to be fashioned for cooperation across the Arabian Sea with island states such as the Maldives, Seychelles and Mauritius.

We can pay lip service to Saarc, but have to recognise that it is not the forum for any meaningful cooperation. New regional architecture has to be crafted, to meet the challenges posed by China’s land and maritime silk routes.

The writer is a former High Commissioner to Pakistan

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