Is South Asia only a figment of the imagination?: Far from it

Sanjay Kathuria
Professor, Global Fellow
Wilson Center
Washington, D.C. USA

Senior Visiting Fellow
Centre for Policy Research
India

Non-Resident Senior Fellow
Institute of South Asian Studies
Singapore

Twitter: Sanjay_1818

It is sometimes said that the term South Asia and its eight included countries is not a useful way to think about the region. As evidence, this narrative points to the very low levels of economic cooperation in South Asia; highlights the fact that leaders of the larger countries do not seem to be much interested in talking to each other, at least as a group (the last South Asian Association for Regional Cooperation summit was held in November 2014); and emphasizes the very different trajectories of cooperation between the eastern and western parts of the region.

I have a very different take on South Asia. I have argued that despite hostility between Pakistan and India, and Pakistan and Afghanistan, and mistrust between many other pairs of countries in the region, the idea of South Asia (comprising Afghanistan, Pakistan, Maldives, Sri Lanka, India, Nepal, Bangladesh and Bhutan) is real, relevant, useful and, ultimately, necessary.

Real, because there are strong cultural and linguistic ties between the countries. Many languages are spoken across overlapping borders—Bengali between Bangladesh and West Bengal and Tripura in India, Urdu/Hindu between much of Pakistan and North and Central India, Pashto between Afghanistan and parts of Pakistan, and Tamil between Tamil Nadu in India and the northern part of Sri Lanka. Bollywood is universally loved and has allowed Hindi/Urdu to be understood across much of the region. A shared passion for cricket has seen Bangladesh and, more recently, Afghanistan, join the traditional elite powers of India, Pakistan and Sri Lanka. Indeed, Afghanistan has been a surprise packet and two of its bowlers are ranked in the top 10 in the world in T-20, the shortest format of the cricket game. Such examples can be multiplied, with music, dance and cuisine finding common ground across South Asian borders.

Migration is also quite evident. Many South Asians were born in other countries in the region, and this is not just a post-Partition phenomenon. In 2000, according to the World Bank’s Global Migration Database, intra-regional migration was 50 percent of total migration from South Asia.

Relevant, because the world’s most successful regions have all had strong intra-regional economic ties. Think European Union, East Asia, North America. South Asian countries are missing a trick in their development playbook by often ignoring the potential of their immediate neighbourhood. Trade within South Asia is only about 1 percent of regional GDP, versus 2.6 percent in Sub-Saharan Africa, and 11 percent in East Asia and the Pacific. The uncertainty in world trade and the push towards relocating supply chains increases the relevance of South Asia.

Useful, because it has been amply demonstrated that there are major economic opportunities that could be unleashed with deeper economic integration. neighbors can gain from deeper economic ties with each other. A recent World Bank study (http://bit.ly/2TLkAGHF) showed that goods trade within South Asia could be three times as high as current trade. And these estimates do not include services, where, arguably, the potential is even higher. If we bring investment into the picture, since trade and investment are inextricably interlinked, then the possibilities are yet greater (https://bit.ly/3ozPISA).  In this context, the virtual banning of trade between India and Pakistan since 2019 can be seen as a “self-goal,” at a time when workers, devastated by COVID-19, need all the jobs that they can get (https://bit.ly/2WH2BSInPk).

For many, the biggest economic prize, at least in the medium-term, is the enormous potential for energy trade. Nepal is sitting on hydro power potential of at least 40 GW, but current capacity is only a little over 1 GW. Northeast India has also installed only about 1.5 GW of its over 58 GW of hydro power potential. The full potential of these and other endowments in the region can only get translated into reality with cross-border power exports. Indeed, the region is very aware of these possibilities, with power trade having expanded almost three-fold over the last decade, to around 17,000 GWh per year. Similarly, Central Asian countries are endowed with significant hydro potential, with ready markets for power exports in neighboring South Asia. Already, the “CASA-1000” project, currently under implementation, seeks to create a 1300 MW interconnection for power export from the Kyrgyz Republic and Tajikistan to Afghanistan and Pakistan. This incipient relationship can be broadened and extended to other countries, with the stated aim of creating the CASAREM (Central Asia-South Asia Regional Energy Market).

This potentially large-scale hydropower trade could, by substitution of fossil fuels, also lead to positive effects on the environment. A World Bank study (http://documents.worldbank.org/curated/en/846141468001468272/pdf/WPS7341.pdf) estimates that regional electricity trade, including hydropower, could reduce carbon dioxide emissions by 8 percent over a 25 year period.

Necessary, because some things cannot be managed alone, even by the biggest country in the region. Pakistan, Afghanistan and India are among the most water-stressed countries in the world. Almost 800 million people in South Asia could be at risk of seeing a sharp decline in living conditions, owing to an increase in greenhouse gas emissions (https://openknowledge.worldbank.org/handle/10986/28723). Climate refugees could spell a humanitarian tragedy. All of these critical issues require collective action by South Asian countries; the alternative would be sharp increases in human suffering as well as the cost of addressing and mitigating the impact of water shortages and climate change. The Coronavirus crisis has also delivered a tragic reminder that communicable diseases can cross borders very quickly in an age of globalization, and regional and global cooperation can help address the problem and the impact more effectively.

Regional connectivity is another necessary condition for landlocked countries like Bhutan, Nepal and Afghanistan to access world markets. India’s Northeast Region is virtually landlocked and requires Bangladesh to ease its access to the rest of India and the world.

Deeper regional cooperation is also necessary to reduce the immense trust deficit in the region, reflected partly in the burden of defence expenditure for several countries in the region.

South Asian countries have two choices. One choice is to continue to let the eastern and western parts of the region move away from each other. This means that while they may benefit from sub-regional cooperation in their respective spheres, especially on the eastern front, the gains for every country will be sub-optimal, because there are important benefits that can only be unleashed through more comprehensive east-west connectivity and economic integration. The most obvious opportunity costs are those relating to energy and transport connectivity, where there could be potentially significant amounts of energy, transport and trade linkages between Central Asia and South Asia. The other choice is to separate economics from politics, and not allow trade and economic exchange to be hostage to political relationships. In this context, even small wins, especially in India-Pakistan economic ties, can benefit the whole region. Initial steps can focus on less controversial aspects like religious tourism, trade in medical products, and cross-LOC trade.

In Amritsar in 2007, former Prime Minister of India Dr. Manmohan Singh had said, “I dream of a day, while retaining our respective national identities, one can have breakfast in Amritsar, lunch in Lahore and dinner in Kabul. That is how my forefather lived. That is how I want our grandchildren to live.” It is this kind of vision, seeking to pull down barriers to connectivity, that will accelerate South Asian countries’ progress and provide a firmer foundation to their quest for prosperity.

This article originally appeared in SAESM Newsletter 2022.

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