ADB offers grant for cooperation between India, Pakistan
3/9/2008 17:24
The Asian Development Bank (ADB) is supporting closer regional cooperation
and integration in South Asia through a grant designed to help strengthen policy
reforms in two key nations, India and Pakistan, said the institution
today.
ADB will provide technical assistance of US$750,000 for the South
Asian Regional Cooperation in 2030 project. The grant will identify constraints
and promote policy reforms and other strategies needed to overcome the barriers
to cooperation and integration in South Asia, the Manila-based development bank
said in a statement.
The grant is focused on India and Pakistan because they
are the region's two largest economies and both have been taking steps to
promote stronger regional cooperation and integration, ADB said.
"India and
Pakistan could potentially play a pivotal role in advancing wider Asian
integration, as well as catalyzing South Asian regional cooperation," said
Jayant Menon, Principal Economist with ADB's Office of Regional Economic
Integration.
In the past, progress on cooperation has been slow and South
Asia remains the least integrated region in the world with intra- regional
trade, for example, accounting for just 2 percent of gross domestic product,
compared to 20 percent in East Asia.
Challenges to closer ties include
persistent poverty, rising inequality, civil conflict and at times, tense
political relations. High levels of trade protectionism also persist despite the
establishment of the South Asian Free Trade Area, ADB said.
However, there
has been progress in recent years with a pickup in the level and pace of
domestic policy reforms across South Asia; improved relations and increased
levels of trade between India and Pakistan; and a greater opening up of South
Asian economies to other regions and the world, it said.
The grant will seek
to support and accelerate domestic policy reforms that have begun in India and
Pakistan, and to identify long-term strategies for closer regional cooperation
that could maximize gains from the policy changes, according to the
statement.
Two country studies will be carried out and an international
conference is planned for October 2009 where the findings will be discussed and
disseminated. Another phase may be carried out examining similar issues in other
South Asian countries, starting with Bangladesh, then Sri Lanka and Maldives,
followed by Nepal, Bhutan and Afghanistan.
Xinhua
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