SAARC or the South Asian Association for Regional Cooperation was established on December 1985. It is basically a political as well as economic organisation of eight countries . It had initially started with the seven countries of India, Pakistan, Bangladesh, Nepal, Bhutan and Maldives. Afganistan was added to the list in 2007 to become the eighth member country.
Historical Evolution of SAARC
In the 1970s, the President of Bangladesh Ziaur Rahman had put forward the idea of a trade bloc that would comprise the South Asian countries. This idea was accepted by India, Bangladesh, Pakistan and SriLanka in Colombo in 1981. In 1983 there was a summit in New Delhi whereby the declaration regarding the formation of the South Asian Regional Cooperation was adopted. Later three other countries of Nepal, Bhutan and Maldives joined in. There were mainly five areas in which these seven countries decided to cooperate:1. Human Resource Development 2. Transport 3. Health and Population Activities 4. Telecommunications, Science, Meteorology and Technology 5. Agriculture and Rural Development
Failure of SAARC
SAARC was conceived so that the South Asian countries could prosper from such an association. But political rivalries between countries like India and Pakistan went against this goal. Hence the status of SAARC is reduced to merely a platform where annual talks and meetings are held.
Free Trade Agreement
Initially the member countries in SAARC had refrained from agreeing to a free trade regime. Although India did have trade agreements with countries like Bhutan, Maldives, Nepal and Srilanka, it declined from doing so with Pakistan and Bangladesh due to political reasons. In 1993, all the member countries decided to lower their tariffs. The Free Trade Agreement was signed in Islamabad nine years later and was effective from July 1, 2006.
2005 Summit At Dhaka
The summit at Dhaka in 2005 conferred the observer's status to countries like China, Japan, South Korea and USA. It was decided that there would be a common fund store that would finance all kinds of programs that may be social , economic or infrastructural.
The dollar is mixed against the majors. The euro and pound were little changed, at $1.2730 and $1.6130. The dollar is outperforming against the Scandies, especially the Norwegian krone, but it is flat against the yen at ¥108.10. The Canadian dollar and Australian dollar are outperforming on the day. In the EM space, Brazil closed 2.5% stronger yesterday, while most EM currencies are trading today with a stronger tone, notably TRY and IDR. On the other side of spectrum, RUB continues to underperform. The MSCI Asia Pacific index gained 1.3%, while EuroStoxx is up about 0.5% near midday.
Nouriel Roubini, a.k.a. “Doctor Doom”, is chairman of Roubini Global Economics and professor of economics at New York University’s Stern School of Business. Roubini has been consistently cited as one of the world’s top global thinkers. This year, he was voted as the most influential economist in the world by Forbes magazine.
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