SAARC AND SAFTA : THEIR FUTURE

PROSPECTS
Harshad Parulekar Harshal Amrutkar Damodar Nair Vijay Adavakar Atul Rane Dheeraj Singh

INTRODUCTION

TheSouth Asian Association for Regional Cooperation(SAARC) is an organization ofSouth Asian nations, founded in December 1985 and dedicated to economic, technological, social, and cultural development emphasizing collective self-reliance. Its seven founding members are Bangladesh ,Bhutan,India, theMaldives,Nepal,Pakistan, andSri Lanka.Afghanistanjoined the organization in 2005. Meetings of heads of state are usually scheduled annually; meetings of foreign secretaries, twice

INTRODUCTION CONTINUED..

The 11 stated areas of cooperation are agriculture; education, culture, and sports; health, population, and child welfare; the environment and meteorology; rural development (including the SAARC Youth Volunteers Program); tourism; transport; science and technology; communications. SAARC economies have been pursuing liberalization & looking towards greater Asia through bilateral FTAs

HISTORY

The concept of SAARC was first adopted by Bangladesh during 1977, under the administration ofPresident Ziaur Rahman .In the late 1970s, SAARC nations agreed upon the creation of a trade bloc consisting of South Asian countries. The idea of regional cooperation in South Asia was again mooted in May 1980. The foreign secretaries of the seven countries met for the first time in Colombo in April 1981. The Committee of the Whole, which met in Colombo in August 1985, identified five broad areas for regional cooperation. New

COUNTRY SHARE OF SAARC

OBJECTIVES

to promote the welfare of the people of South Asia and to improve their quality of life; to accelerate economic growth, social progress and cultural development in the region and to provide all individuals the opportunity to live in dignity and to realize their full potential; to promote and strengthen collective selfreliance among the countries of South Asia;

OBJECTIVES CONTINUED
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To promote active collaboration and mutual assistance in the economic, social, cultural, technical and scientific fields; To strengthen cooperation with other developing countries; To strengthen cooperation among themselves in international forums on matters of common interest; and To cooperate with international and regional organizations with similar aims and purposes.

MEMBERSHIP
Current members (alphabetically) AFGHANISTAN Bangladesh Bhutan INDIA MALDIVES NEPAL PAKISTAN SRI LANKA

SAARC LEADERS

VARIOUS CENTRES OF SAARC

1.SAARC Agricultural Information Centre (SAIC), Dhaka 2.SAARC Meteorological Research Centre (SMRC), Dhaka 3.SAARC Tuberculosis Centre (STC),Kathmandu 4.SAARC Documentation Centre (SDC), New Delhi 5.SAARC Human Resources Development Centre (SHRDC), Islamabad 6.SAARC Costal Zone Management Centre, Maldives 7.SAARC Information Centre, Nepal 8.SAARC Energy Centre, Pakistan 9.SAARC Disaster Management Centre, India

SECRETARIES GENERAL

Abul Ahsan January 16, 1987 to 15 October 1989 Kant Kishore Bhargava October 17, 1989 to December 31, 1991 Ibrahim Hussain Zaki January 1, 1992 to December 31, 1993 Yadav Kant Silwal January 1, 1994 to December 31, 1995 Naeem U. Hasan January 1, 1996 to December 31, 1998 Nihal Rodrigo January 1, 1999 to January 10, 2002 Q.A.M.A. Rahim January 11, 2002 to February 28, 2005 Lyonpo Chenkyab Dorji March 1, 2005 to February 29, 2008

REASONS FOR FORMATION OF SAARC

One of the major objectives of formation of SAARC forum was to accelerate the process of economic and social development in member States.

As a result of British Colonialism, all countries have same cultural background and history. The region is poor and over populated. Predominance of agriculture . Therefore dependence of the economy on

FUTURE MEMBERSHIP
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The People's Republic of China has shown its interest in joining SAARC. Indonesia intends to become an observer as well, and is supported by Sri Lanka Iran, a state with borders to two SAARC members, has traditionally enjoyed strong cultural, economic and political relationships with Afghanistan and Pakistan and has expressed its desire to become a member of the South Asian organization. On 22 February 2005 Russia intends to become an observer as well and is supported by India Myanmar has expressed an interest in joining as a full member, even though it is already a member of the ASEAN.

SOUTH ASIAN FREE TRADE AREA (SAFTA)

SAFTA Agreement was signed at the 12th SAARC Summit in January 2004 at Islamabad. Originally scheduled to start on 1 January 2006, SAFTA actually came into force on 1 July 2006. Afghanistan was made the 8th member by a decision of the 13th SAARC Summit in Dhaka in November 2005. China , Japan, South Korea, Iran, Mauritius, the U.S. and the E.U. have been given observer status. Australia and Myanmar have expressed desire to be conferred observe status

OBJECTIVES
The primary objective of SAFTA is to benefit the small economies of countries like Bhutan, Maldives and Bangladesh. A major objective of SAFTA is to expand intra-regional trade Providing greater opportunities of employment Increase the share in the total volume of South Asian Trade Strengthening intra-regional economic Cooperation

INSTRUMENTS
The SAFTA Agreement will be implemented through the following instruments: 1. Trade Liberalisation Programme 2. Rules of Origin 3. Institutional Arrangements 4. Consultations and Dispute Settlement Procedures 5. Safeguard Measures 6. Any other instrument that may be agreed upon.

INTRA-SAARC TRADE FLOWS UNDER SAFTA

EFFECTS OF SAFTA : POSITIVE VIEWS

SAFTA will bring significant gains for the small economies of the region It will attract foreign capital. It will be a step toward better political relations and peace Dynamic gains will be more significant than static gains Part of the informal trade will be diverted to official channels and bring revenue and other benefits

EFFECTS OF SAFTA : NEGATIVE VIEWS

SAFTA does not meet the standard economic criteria for successful integration Long sensitive lists of members will lower the benefits of trade SAFTA will benefit India the most. Some member countries may even lose. SAFTA will lead to trade diversion. Because of similar production structures in member countries, the expansion of intra-regional trade will be limited.

AREAS OF COOPERATION

Agriculture and Rural Development Health and Population Activities Women, Youth and Children Environment and Forestry Science and Technology and Meteorology Human Resources Development Transport.