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WORLD HINDU ECONOMIC FORUM

Trade Barriers in South Asia


Suman Sahai
Chairperson

WHEF 2013 @ Bangkok : Strengthening Economy, Shaping Future

WORLD HINDU ECONOMIC FORUM


Trade Barriers in South Asia
Reducing regional trade barriers could result in a 17% increase in GDP for Bangladesh and Sri Lanka, a 15% increase for India, & a 5% increase for Pakistan by 2020 -Isabel Guerrero
Regional borders impede S Asias economic growth. Only two borders Afghanistan/Pakistan &

India/Nepal are open to trucks. Mountains of paperwork. Complying with trade formalities in S Asia takes 30 days
- Lat Am - 20 days - OECD - 11 days WHEF 2013 @ Bangkok : Strengthening Economy, Shaping Future

WORLD HINDU ECONOMIC FORUM


Container shipment within S Asia costs 25 % more than within Lat Am & 50 % more than within OECD Trade from India to Pakistan goes via Dubai rather than over land or from Karachi to Mumbai.

Poor infrastructure, logistics & inefficient management systems have lowered trade competitiveness. Rail networks do not connect S Asian countries
Track gauge differences mean trains from one country cannot run in another.
WHEF 2013 @ Bangkok : Strengthening Economy, Shaping Future

WORLD HINDU ECONOMIC FORUM

S Asia trade with other countries


Trade with SAARC 3 % Trade with ASEAN 25%

WHEF 2013 @ Bangkok : Strengthening Economy, Shaping Future

WORLD HINDU ECONOMIC FORUM


Needed
Infrastructure integration Customs reform Systems modernization Capacity building Monitoring & evaluation

WHEF 2013 @ Bangkok : Strengthening Economy, Shaping Future

WORLD HINDU ECONOMIC FORUM Needed


Regional power grid integration (energy deficits take heavy toll on S Asian economies) Nepal, Bhutan, & Central Asia have huge hydropower resources - can be developed & traded Coal & natural gas resources of B-desh, India & Pakistan can add to energy security of the region
WHEF 2013 @ Bangkok : Strengthening Economy, Shaping Future

WORLD HINDU ECONOMIC FORUM


Telecom Barriers
Telecom & electronic infrastructure must be integrated in the region - B-desh to India phone call costs double a B-desh to US call Exorbitant roaming rates - Bhutanese in India pays 60 times more for a call than a call with an Indian SIM Card Facilitating intra-regional trade will mean - cheaper transport, bigger markets, broader supply chains Will reduce - production cost, create jobs.
WHEF 2013 @ Bangkok : Strengthening Economy, Shaping Future

WORLD HINDU ECONOMIC FORUM


Barrier to Horticultural/Agriculture Exports
Poor sanitary & phytosanitary testing
- losses from rejected consignments - high transaction costs due to duplicative testing - high levels of entry-point inspection & treatment of goods on arrival

WHEF 2013 @ Bangkok : Strengthening Economy, Shaping Future

WORLD HINDU ECONOMIC FORUM


BCIM (Bangladesh, China, India & Myanmar)
BCIM urged governments to remove trade barriers for greater economic cooperation in the region Barriers: Poor transport connectivity (rail, water & road) Low investment Myanmar new trading partner - agriculture - gems - manufacturing - services
WHEF 2013 @ Bangkok : Strengthening Economy, Shaping Future