Dragon’s Shadow Looms Over Saarc

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  • With a promised investment of $30 billion in the South Asian region over the next five years, China's shadow loomed large over the Saarc summit here.
  • Beijing said at the summit that it was willing to “elevate“ its relationship with the regional body which has been dominated by India until now.
  • Pakistan sought this elevation in status for both China and South Korea,
  • Both observers, at a foreign ministry-level meeting in New Delhi earlier this week and its Prime Minister Nawaz Sharif called for greater interaction with observer countries.
  • India would be more worried about Sri Lankan President Mahinda Rajapaksa too saying in his address that it was “imperative“ for South Asian countries to engage with observers for their own “capacity-building“ initiatives.
  • In fact, Maldives President Abdulla Yameen Abdul Gayoom and Bangladeshi PM Sheikh Hasina too expressed the same sentiment about engaging observers.
  • China is looking to increase its annual trade volume to $150 billion with Saarc nations in the next five years.
  • Beijing was represented at the summit by its vice foreign minister Liu Zhenmin
  • Liu Zhenmin said that China wanted to expand business links with countries in south Asia to facilitate economic growth in the region.
  • While Chinese President XI Jinping had assured India of support for its membership of the Shanghai Cooperation Organization (SCO).
  • Chinese President had at the same time sought cooperation from New Delhi for Beijing's role in Saarc.
  • Indian officials had later clarified that this was not a condition put forward by China for its support to India in SCO.
  • India is currently an observer at the six-nation central Asia security group -dominated by Russia and China -which many see as an important player in Afghanistan after the withdrawal of US-led international forces.
  • Bangladesh pushes for Free Trade Agreement
  • Bangladeshi PM Sheikh Hasina called for implementing the free trade agreement (FTA) that the Saarc nations had signed nearly a decade ago.
  • Hasina underlined the need to implement the South Asian Free Trade Agreement (Safta), Xinhua reported.
  • The accord was signed by the Saarc member states Jan 6, 2004, at the 12th Saarc Summit in Pakistan's capital Islamabad.
  • Safta required the developing countries in South Asia ­­India, Pakistan and Sri Lanka ­­to bring their duties down to 20 percent in the first phase of a two-year period ending in 2007.
  • In the final five-year phase ending 2012, the 20 percent duty was to be reduced to zero in a series of annual cuts.