SCCI seeks intra-SAARC investment

MALE, Jan 17: The business leaders of SAARC countries suggested intra-regional investment and free mobility of motor vehicles across South Asia to enhance trade for shared prosperity of over one billion people, reports UNB.

Their recommendations came from the 6th annual general meeting and 16th executive committee meeting of the SAARC Chamber of Commerce and Industry (SCCI) in this capital city of the Maldives today (Monday).

The SCCI meetings pressed for a multi-modal vehicular agreement in the region that will open free mobility of transport.

"A geographical survey of South Asia supports such a regional agreement which will benefit at least five out of seven SAARC countries. Although all governments have agreed to support this in principle, it is still not materialised."

The SAARC Chamber also emphasised harmonisation of customs rules and regulations evolving homogenous quality parameters and supporting further enhancement of free movement of goods in the region.

"In comparison with the intra-SAARC trade, the intra-SAARC investment is lower and discouraging. Intra-regional investment can play a vital role in the development of the region, especially for the LDCs," it noted.

Mentioning scenarios of other regions of the world, the chamber leaders commented that regional arrangements in East Asia proved that the LDCs were more successful in attracting foreign direct investment (FDI) when they targeted developing countries of the region.

In the early 90s, 65 per cent of all FDI inflow to China, 40 per cent to Malaysia and almost 30 per cent to Indonesia had their origins in the East Asian region.

In this regard, the SCCI leaders felt the need for specific legal and regulatory frameworks to attract investment in major south Asian projects.

"It means a regional investment agreement is needed for promotion and protection of investments in the SAARC region," the SCCI said.

The leaders described double-taxation as an impediment and said its avoidance would enhance trade and investment flows manifold.

At present, bilateral agreements for avoidance of double-taxation exist between Indian and Nepal, Pakistan and Bangladesh, and Pakistan and Sri Lanka.

But only several agreements are not enough to boost regional trade, the SAARC business body noted, saying that an agreement is required either at regional level or on bilateral plane among the seven member nations to avoid double-taxation.

Outgoing president of SCCI Kanitkumar Poddar and newly-elected president Qasim Ibrahim chaired the meetings.

FBCCI president Abdul Awal Mintoo led a 10-member Bangladesh delegation. Other members include M A Mumin, Abu Alam Chowdhury, Mir Nasir Hossain, Abdul Haq, Dewan Sultan Ahmed, Shamsul Kawnain Kutob and Shafiullah Chowdhury.

Other issues that dominated the meetings included formulating a common position at WTO negotiations, transformation of SAPTA into SAFTA, SAARC arbitration council and tourism.

The business leaders called upon the governments to begin 4th Round of SAPTA and its transformation into South Asian Free Trade Area at the earliest.

As a proposal for forming SAARC arbitration council is pending with the SAARC secretariat, the business leaders' meetings urged constituting the proposed council under the aegis of SCCI.