SAARC: A healthy grouping or a dead body?

By | November 26, 2014

SAARC: South Asian Association for Regional Cooperation


It is a regional economic and geopolitical body of 8 countries of South Asia consisting of India, Pakistan, Nepal, Sri Lanka, Maldives, Bangladesh, Bhutan and Afghanistan. Headquartered in Kathmandu, Nepal, it came into existence on 8 December 1985. This area is one of the most populated and underdeveloped regions of the world. It boasts of having nearly 21% of the entire population of the world covering just above 3% of its geographical area.

India is the largest and undoubtedly the biggest and the most powerful and influential nations of SAARC. India accounts for two-thirds (2/3) of the entire geographical extent of SAARC, three-fourths (3/4) of the entire population and four-fifths (4/5) of its entire GDP. India has been instrumental in the progress of SAARC and has played a significant role in strengthening it as a multilateral regional organisation. However, SAARC has not been a success over the years and has been unable to find substantial solutions to regional problems.

South Asian region is one of the most underdeveloped regions of the world inhabiting maximum number of impoverished people. India alone accounted for nearly 21% of the world’s poorest people in 2013. In the recent times, South Asia has emerged as one of the biggest markets in the world. Yet, the trade between SAARC countries remains abysmally low. For instance, if we consider India’s trade with the other SAARC countries, given as follows:

S.NO Country Percentage trade
1. Afghanistan 0.15%
 2. Bangladesh 1.96%
 3. Bhutan 0.11%
4. Maldives 0.03%
5. Nepal 1.14%
6. Pakistan 0.72%
7. Sri Lanka 1.44%


Inspite of all these member nations sharing land borders with India, we can observe that India’s net trade with all the SAARC countries put together would not be more than 6% of its total trade with other countries. Given, the land and sea connectivity of this region, these trade values are abysmally low. Such stark contrasts can be observed with the trade data of other countries as well. The intra SAARC trade accounts for only 1% of SAARC’s total GDP which is very low as compared to intra ASEAN trade which is nearly 10% of ASEAN’s GDP. It is worth reckoning that SAARC has a larger GDP than ASEAN.

SAFTA or the South Asian Free Trade Agreement was a regional free trade agreement put forward in the eighth SAARC summit in New Delhi which was to be preceded by a customs union, a common market and then an economic union. However, the concept of SAFTA is in a state of limbo from the past 2 decades now. Each country has its own reservations for SAFTA. No regional consensus has been reached thus far. The failure of SAARC can also be attributed to tensions between India and Pakistan, two of the biggest members of the grouping in terms of GDP, geographical extent and size of population.

Eighteenth SAARC summit in Kathmandu, Nepal has also been over shadowed by the animosity and unfriendly relations between the two biggest economies of South Asia. Though Nepal has been trying to bridge the thaw between the two nations, both of them seem reluctant to come together. The colonially inherited issues are acting as the major fault lines between the two nations which share a long land boundary. SAARC cannot be a success without two of its biggest economies.

In its 30 years of existence, nothing substantial has been extracted out of this grouping and it has acted as a dead body rather than being a healthy one. The member nations must remember that its success will provide unlimited avenues of cooperation and growth to all its member nations whether big or small.

2 thoughts on “SAARC: A healthy grouping or a dead body?

  1. Pingback: Regional Institutions References | Pearltrees

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