Pakistan has underscored the need for developing an Electronic Data Interchange (EDI) to resolve teething issues amongst the Saarc member countries. This proposal was floated by Commerce Minister Engineer Khurram Dastgir in his address at the 8th South Asian Free Agreement (SAFTA) Ministerial Council meeting being held in Thimpu (Bhutan).
During deliberations, the Commerce Minister emphasised the importance of connectivity; specifically land-ports and energy-grids within the Saarc region. Pakistan also supported India's proposals to establish a Saarc Development Bank and currency swap agreements which would further the cause of regional connectivity and integration. "Let us have the courage to open hearts and our markets to each other," reported said Commerce Minister who is making all out efforts to convince domestic stakeholders to allow the government to forge good trade relations with India if the latter accepts Pakistan's demands. Analysts believe as Foreign Secretaries of India and Pakistan are meeting in the forth week of August in Islamabad to carry forward the dialogue process, which implies that trade ties will be on top of the agenda of both the top diplomats.
"Commerce Minister who was isolated in fighting for improvement in trade ties with India will be more than happy to see Foreign Secretaries of both countries discuss trade along with other key issues," commented an official on condition of anonymity. Addressing the SAFTA Ministerial Council, Commerce Minister said in the present scenario of persistent global slow growth, it is imperative that SAFTA member states keep their markets open and keep widening the opening to ensure that the region keeps moving towards the goal of development. He reiterated Pakistan's assurance of enhanced access to Least Developed Countries (LDCs) within SAFTA, to keep its market open for trade and deepen Pakistan's integration into the regional economy and to provide all SAFTA partners a non-discriminatory market access on a reciprocal basis. He, however, urged other Saarc countries to take measures to encourage regional trade.
Dastgir further stated that Saarc region should continue to create a business-friendly environment that helps businesses to succeed. However, in motivating SAARC business communities to venture in the region, the member countries need to ensure that they are provided a conducive environment and a level-playing field. He maintained that since assuming his office last June, Prime Minister Nawaz Sharif has made enhancing trade and connectivity in the region the cornerstone of his government's policymaking. Poor infrastructure and intra-SAARC connectivity remain a paramount issue which the member countries need to overcome in order to ensure that SAFTA realises its true potential.
He said Pakistan has embarked upon strenuous efforts to address infrastructure inadequacies as a matter of high priority. "We believe that in order to improve regional trade ties, we need to build trade and economic corridors with our neighbours by linking our highways, sea and land ports and airport facilities," he continued Keeping in view the significance of land ports in regional connectivity, Pakistan by the end of this year would be establishing Land Ports Authority (LPA) with the objective of effectively and efficiently managing and supervising land ports thus ensuring better facilities to exporters, importers and trade with neighbouring countries, he further added.
The infrastructure facilities at Torkhum, Chaman and Wagha land ports would be further improved keeping in view their role in promotion of regional trade and investment particularly with Afghanistan and India. "We also intend to explore the possibility of enhancing direct shipping routes to India, Bangladesh, Sri Lanka and Maldives. The possibilities of reaching out to land-locked Nepal and Bhutan are also under study," he stated.
Commerce Minister stated that as members of a developing region, SAARC countries face the common problem of capacity constraints at borders, which causes delays in customs clearance and port procedures. Such constraints undermine the competitiveness of business community. He said trade facilitation is one of the key areas where all member countries need to make collective progress. Commenting on agriculture, Commerce Minister stated that all the Saarc countries need not take such measures which create an element of trade distortion.
With the deeper integration of the region through the Saarc agreement of Trade in Services (SATIS), Pakistan believes that the region would be more competitive and lead to a more conducive environment for businesses to operate and flourish in. The implementation of SATIS will hence broaden and deepen the current linkages and engagement amongst members. Pakistan looks forward to the deeper ties and boost to trade and investment that this agreement will bring to the region, he stated. Pakistan sees this agreement as a complementary and contributory vehicle towards SAFTA, which can be a game-changer for regional economic integration, Dastgir further stated.
He maintained that SAARC countries need to pursue the objective of regional economic integration and develop regional value chains so as to strengthen member countries in the global trade game. Although, a visible progress has been made, much remains to be done.
He highlighted the following areas of concern: (i) SAARC countries must reduce non-tariff barriers to trade as, so far, discussions on NTBs/NTMs are inconclusive. It is high time that the regional bloc introduces certain timelines wherein reported NTBs/NTMs issues could be resolved amongst SAFTA countries, perhaps on the pattern of TLP negotiations; (ii) SAARC needs to streamline customs procedures and more business-friendly administrative processes. The progress of sub-group on Customs co-operation has been commendable and the region now needs to move forward on developing SAARC EDI (Electronic Data Interchange) which would likely resolve many teething issues; (iii) establishment of the South Asian Regional Standards Organisation (SARSO) and signing of the agreements on Multilateral Arrangement on Recognition of Conformity Assessment and the agreement on Implementation of Regional Standards would prove as significant steps to harmonise standards, procedures and certifications. However, it is desirable that all unnecessary regulatory burdens including administrative processes are simplified; (iv) Saarc may need to revisit SAFTA rules of origin and related administrative procedures. The Asian Development Bank report on regional economic integration makes some important recommendations in this regard and SMC being the apex policy making body of SAFTA may direct the Committee of Experts (CoEs) to engage in discussion and come up with a solid set of recommendations; and (v) the regional bloc needs to strengthen the institutional basis of Saarc on the pattern of ASEAN. The member countries may look into the possibility of a strong regional trade promotion team which could propose measures to boost intra-SAARC trade in close co-ordination with Saarc Chamber of Commerce and other leading trade bodies/associations of the region. He stated that Pakistan will continue to be a staunch advocate of free trade and appropriate vehicles that can further this agenda. A free and open regional economy is an important part of Pakistan's growth, he concluded.