Event Reports

Bhutan’s concerns need to be addressed for better sub-regional growth: Expert

BBIN,Bhutan
BBIN,Bhutan
BBIN,Bhutan
BBIN,Bhutan
BBIN,Bhutan
Photolabs@ORF
2017
May
09

India and Pakistan rivalry since shared Independence is at the heart of the integrated issues in South Asia, making the integration problem more complicated, according Dr Vinitha Revi, an independent researcher on international relations.

Initiating a discussion on “South Asia: Challenges of Integration” at the Chennai Chapter of Observer Research Foundation on April 22, 2017, Dr. Revi said “South Asia as a cooperative venture goes with the problem of perception, distrust and fear factors throughout the region.” She pointed out that South Asia was the most complicated region, with least integration and high levels of political instability and economic vulnerability.

Dr. Revi said though the nations of the region founded the South Asia Association for Regional Cooperation (SAARC) as far back as 1985, with Afghanistan joining it later, inherent issues remained to be addressed. The region holds 21 percent of world’s population in three percent of the global landmass, indicating the high density of population, and accounting for only four percent of the global economy. With all these impediments, SAARC did launch the South Asian Free Trade Area (SAFTA) in 2006, to try and bridge mutual trade and economic imbalances within the region, with a spirit of friendship, trust and understanding, she noted.

The internal conflicts within the region, the absence of lasting peace and thus prosperity in the region have all made regional integration elusive, Dr. Revi said. Pakistan especially sees almost every SAARC initiative as an Indian strategy to organise other South Asian nations against it. In economic terms, Pakistan continues to harbour the feeling that SAARC and SAFTA are aimed at creating an India-dominated regional market for Indian products and services, thereby consolidating and further strengthening India’s economic dominance in the South Asian region, she pointed out.

In more recent times, the integration process was stymied further by the  ‘postponement’ of the 19th SAARC Summit at Islamabad, after Afghanistan, Bangladesh, Bhutan and India decided to boycott it over Pakistan’s unwillingness to curb cross-border terrorism from within its territory. No fresh dates have been announced since. As Dr. Revi pointed out, SAARC summits also provided opportunities for bilateral meetings between member-nations.

The postponement of the Islamabad Summit might have interfered with this process, she said, pointing out, how India-Pakistan high-level meetings and issues invariably used to hijack media space across the world in terms of SAARC coverage. In this context, Dr. Revi said that South Asia should be judged by capabilities and intentions in order to address the problem of perception, going beyond the obvious and not-so-obvious impediments.

‘Alternatives’ to SAARC

The Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC), is an alternative to the SAARC, Dr. Revi said. This became necessary after it became clear that SAARC always faced the problem of perception. There is distrust among the countries due to fear factor. The policy incongruence is tangible with the talks connecting the roads but blocking the borders. Due to such vulnerabilities, the adjoining Indian Ocean too has become the most militarised and ‘nuclearised’ zone in the world, Dr. Revi said.

The Bangladesh Bhutan India Nepal (BBIN) is yet another sub-regional initiative in South Asia, with quadrilateral agreement across transport, infrastructure, water, tourism, trade, communications and energy resources. The South Asian Growth Quadrangle sought to impel the sub-region’s latent socio-economic potential, harnessing disparate stages of development to augment each other.

The borders of BBIN countries, Dr Revi pointed out, rest within 50 km of Siliguri within India.  Contiguity norms, traditions and lifestyle among inhabitants of the sub-region from four nation-states underscore the importance of an integrated market. India planned for a 30-road project worth $8 billion and approved $1.08 billion for the construction and improvement of about 500-km long roads connecting Bangladesh, Bhutan and Nepal. The project receives 50 percent funding from the Asian Development Bank (ADB), and was scheduled to be completed by 2018. It is estimated that this project will help increase regional trade by 60 percent and the region’s trade with the rest of the world by 30 percent.

Electronic permits

The BBIN-MVA idea followed Pakistan’s rejection of a regional motor vehicle agreement at the 18th SAARC Summit at Kathmandu in November 2014, she said. The BBIN-MVA, signed in Bhutan on 15 June 2015, would facilitate inter-operability of vehicle, cargo and people’s movement among member-nations, and across their territories, to third nations. By introducing an ‘electronic permit’ system and continuing with the existing border-posts and border-security regimes, the agreement aimed at saving costs and time in border transhipment, at times at several points within the sub-region at present.

Under the system, vehicle permits are issued online and sent across the internet to all land ports, and cargo-movements are monitored electronically. This agreement was to enter into force once it was ratified by all four member-nations. The agreement has been ratified by Bangladesh, India and Nepal. The lower house of the Bhutanese parliament approved the agreement in early 2016, but it was rejected by the upper house in November 2016.

Dr. Revi said Bhutan has since requested for a cap to be fixed on the number of vehicles entering its territory. Bhutan‘s objective is to protect the nation’s environment, also because environment-protection is one of the four pillars of the nation’s scheme on and for ensuring sustainable development. In 40 years, the road-network within the Himalayan kingdom had grown from 1500 km to 12000 km, accounting for a 233-percent increase in mass vehicle movement in the country.

Though the BBIN-MVA thus faces its first major road-block in Bhutan, especially over environmental issues, it was still a welcome initiative as it covered various sectors of the sub-region’s growth and development prospects, she pointed out. There was scope for improving sub-regional transport, goods and services, trade, tourism and people-to-people contacts, Dr. Revi added.

Bhutan’s economy depended on tourism and transport, but any sub-regional spread and growth comes with the invisible threat over possible domination of business interests from other countries within the BBIN framework.  These issues are genuine from Bhutan’s perspective, and their concerns too need to be addressed for the sub-region and the region to grow together and through mutual cooperation, Dr Revi concluded.

This report was written by S. Sivanesan, Associate at Observer Research Foundation, Chennai.