Greater integration could boost intra-South Asian trade
South Asia will be the fastest growing region in Asia and the regional cooperation and integration in South Asia is vital for countries to improve competitiveness and productivity, said Takehiko Nakao, President, Asian Development Bank (ADB). The ADB president was speaking at the Informal Meeting of the South Asian Association for Regional Cooperation (SAARC) Finance Ministers in Baku, Azerbaijan. Referring to the ADB’s recently released Asian Development Outlook, the ADB president said, “The South Asian Economy is expected to grow by 7.6% in 2016 and 7.7% in 2017.” And, this positive outlook can further be enhanced by at least half a percentage point through accelerating regional integration, he said. “A greater integration could generate more than US$ 50 billion of additional intra-South Asian trade annually by 2020,” he said referring to the study. Talking about East Asia, he said that open trade and investment policies in the region induced multinationals to choose a production platform, which later turned into ‘Factory Asia’ for their production activities. The positive moves by the Association of South-East Asian Nations (ASEAN) towards export-oriented mechanism and increased openness to the Foreign Direct Investment (FDI), market-friendly policies, has led to the expansion of the global networks within the East-Asian region, he added. More specifically, project-driven approach towards the economic cooperation has helped the ASEAN countries in achieving an increased cross-border transport, power connectivity, implementation of trade facilitation measures, he opined. The ADB president said that the South Asian integration will provide impetus to the increased integration between South Asia and East Asia. Referring the increasing economic ties between India, Myanmar and Sri Lanka through infra connectivity projects like roads and ports, he said these countries are making efforts to reduce trade and investment barriers. But much more remains to be done. The ADB president also said that for the period 2016-17, the bank has programmed almost US$ 4 billion in regional projects in South Asia, mobilizing ADB and government resources. In a similar way, the ADB will continue to provide necessary support to SAARC in boosting regional integration and cooperation, he said, adding that the SAARC is also assisting the SAARC secretariat with analytical work and capacity building activities.
May 4, 2015 | 6:48 pm IST.