News / Economy

    India Looks to Boost Trade with South Asian Nations

    External Affairs Minister of India Sushma Swaraj speaks with her Bangladeshi counterpart Abul Hassan Mahmood Ali at the Ministry of Foreign Affairs, Dhaka, June 26, 2014.
    External Affairs Minister of India Sushma Swaraj speaks with her Bangladeshi counterpart Abul Hassan Mahmood Ali at the Ministry of Foreign Affairs, Dhaka, June 26, 2014.
    Anjana Pasricha

    India’s new government is moving ahead to deepen trade and investment ties with its neighbors, as South Asia remains one of the least economically integrated regions in the world.

    Before wrapping up a visit to Bangladesh Friday, Indian foreign minister Sushma Swaraj announced several concessions: New Delhi will relax visa requirements, supply more power to its neighbor and increase investments to address a trade imbalance in its favor.

    Swaraj pointed out that India would not be able to pursue its development agenda without bringing its smaller neighbors along with it.

    This is the broader message from India’s month-old government as it promises to step up trade and investment with countries like Nepal, Bangladesh, Sri Lanka and Bhutan.

    Indian foreign ministry spokesman Syed Akbaruddin said economic goals top the agenda.

    “The overriding priority for India is to scale and speed our comprehensive national development and we will try to work out measures by which our diplomats in the region can assist in that national endeavor,” said Akbaruddin.

    South Asia has been the flavor of the month in the Indian foreign ministry offices since Prime Minister Narendra Modi made the unprecedented gesture of inviting heads of neighboring countries to attend his inauguration. He followed that up with a visit to Bhutan in mid June.

    Analysts say the stepped-up diplomacy is partly intended to limit China’s sphere of influence in South Asia. But equally important is a drive to give more primacy to trade in a region where political hostility and suspicion have impeded economic integration. 

    South Asia - a populous region of two billion people -- lags behind other parts of the world in regional trade. Economists compare the meager five percent of trade in this bloc to the more robust 25 percent in the Association of South East Asian Nations.

    Cross border trade has been restricted between the region's two biggest countries, India and Pakistan, due to their hostile ties. A 2005 agreement to turn the region into a free trade zone has failed to yield substantive results.  High tariffs remain an impediment.

    Economist Rajiv Kumar at the Center for Policy Research in New Delhi says the key to better economic integration is to remove mistrust.

    He is optimistic. Kumar said the new government has signaled that it will move to allow freer movement of goods, people and services.

    “At the moment Bangladesh trucks are not allowed to come into India and go to wherever they want, or we do not allow access of Pakistani trucks to go across to Bangladesh, etc. All of that can change if India was to take a more magnanimous or more foresighted views, that this trade will only benefit us and open its borders and its markets to our neighbors. The most important part will be to India become more open, more liberal and permit our neighbors to benefit from our own growth and our own large market,” said Kumar.

    India is promising to build new road and rail links in the region and boost infrastructure at border trading posts.

    For example, Swaraj said India is willing to increase the frequency of a train service which links it to Bangladesh and will explore the possibility of starting a bus service between the two countries. A road connecting India to Myanmar, which is also known as Burma, is expected to open in October.

    Analysts say revitalizing economic ties in South Asia could bring big benefits for a region that is battling high levels of poverty.

    You May Like

    Russian-speaking Muslim Exiles Fear Possible Russia-Turkey Thaw

    Exiled from Russia as Islamic radicals and extremists, thousands found asylum in Turkey

    US Presidential Election Ends at Conventions for Territorial Citizens

    Citizens of US territories like Guam or Puerto Rico enjoy participation in US political process but are denied right to vote for president

    UN Syria Envoy: 'Devil Is in the Details' of Russian Aleppo Proposal

    UN uncertain about the possible humanitarian impact of Russian proposal to establish escape corridors in Aleppo

    Featured Videos

    Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
    Uganda Unveils its First Solar-powered Busi
    X
    July 28, 2016 4:16 AM
    A solar-powered bus described by its Ugandan makers as the first in Africa has made its public debut. Kiira Motors' electric bus, Kayoola, displayed recently at a stadium in Uganda's capital. From Kampala, Maurice Magorane filed this report narrated by Salem Solomon.
    Video

    Video Uganda Unveils its First Solar-powered Bus

    A solar-powered bus described by its Ugandan makers as the first in Africa has made its public debut. Kiira Motors' electric bus, Kayoola, displayed recently at a stadium in Uganda's capital. From Kampala, Maurice Magorane filed this report narrated by Salem Solomon.
    Video

    Video Silicon Valley: More Than A Place, It's a Culture

    Silicon Valley is a technology powerhouse and a place that companies such as Google, Facebook and Apple call home. It is a region in northern California that stretches from San Francisco to San Jose. But, more than that, it's known for its startup culture. VOA's Elizabeth Lee went inside one company to find out what it's like to work in a startup.
    Video

    Video Immigrant Delegate Marvels at Democratic Process

    It’s been a bitter and divisive election season – but first time Indian-American delegate Dr. Shashi Gupta headed to the Democratic National Convention with a sense of hope. VOA’s Katherine Gypson followed this immigrant with the love of U.S. politics all the way to Philadelphia.
    Video

    Video Philadelphia Uses DNC Spotlight to Profile Historic Role in Founding of United States

    The slogan of the Democratic National Convention now underway in Philadelphia is “Let’s Make History Again” which recognizes the role the city played in the foundation of the United States in the 18th century. As VOA’s Kane Farabaugh reports, local institutions are opening their doors in an effort to capitalize on the convention spotlight to draw visitors, and to offer more than just a history lesson.
    Video

    Video A Life of Fighting Back: Hillary Clinton Shatters Glass Ceiling

    Hillary Clinton made history Thursday, overcoming personal and political setbacks to become the first woman to win the presidential nomination of a major U.S. political party. If she wins in November, she will go from “first lady” to U.S. Senator from New York, to Secretary of State, to “Madam President.” Polls show Clinton is both beloved and despised. White House Correspondent Cindy Saine takes a look at the life of the woman both supporters and detractors agree is a fighter for the ages.
    Video

    Video Dutch Entrepreneurs Turn Rainwater Into Beer

    June has been recorded as one of the wettest months in more than a century in many parts of Europe. To a group of entrepreneurs in Amsterdam the rain came as a blessing, as they used the extra water to brew beer. Serginho Roosblad has more to the story.
    Video

    Video First Time Delegate’s First Day Frustrations

    With thousands of people filling the streets of Philadelphia, Pennsylvania for the 2016 Democratic National Convention, VOA’s Kane Farabaugh narrowed in on one delegate as she made her first trip to a national party convention. It was a day that was anything but routine for this United States military veteran.
    Video

    Video Commerce Thrives on US-Mexico Border

    At the Democratic Convention in Philadelphia this week, the party’s presumptive presidential nominee, Hillary Clinton, is expected to attack proposals made by her opponent, Republican presidential nominee Donald Trump, to build a wall along the U.S.-Mexico border. Last Friday, President Barack Obama hosted his Mexican counterpart, President Enrique Peña Nieto, to underscore the good relations between the two countries. VOA’s Greg Flakus reports from Tucson.
    Video

    Video Film Helps Save Ethiopian Children Thought to be Cursed

    'Omo Child' looks at effort of African man to stop killings of ‘mingi’ children
    Video

    Video London’s Financial Crown at Risk as Rivals Eye Brexit Opportunities

    By most measures, London rivals New York as the only true global financial center. But Britain’s vote to leave the European Union – so-called ‘Brexit’ – means the city could lose its right to sell services tariff-free across the bloc, risking its position as Europe’s financial headquarters. Already some banks have said they may shift operations to the mainland. Henry Ridgwell reports from London.
    Video

    Video Recycling Lifeline for Lebanon’s Last Glassblowers

    In a small Lebanese coastal town, one family is preserving a craft that stretches back millennia. The art of glass blowing was developed by Phoenicians in the region, and the Khalifehs say they are the only ones keeping the skill alive in Lebanon. But despite teaming up with an eco-entrepreneur and receiving an unexpected boost from the country’s recent trash crisis the future remains uncertain. John Owens reports from Sarafand.
    Video

    Video Migrants Continue to Risk Lives Crossing US Border from Mexico

    In his speech Thursday before the Republican National Convention, the party’s presidential candidate, Donald Trump, reiterated his proposal to build a wall along the U.S.-Mexico border if elected. Polls show a large percentage of Americans support better control of the nation's southwestern border, but as VOA’s Greg Flakus reports from the border town of Nogales in the Mexican state of Sonora, the situation faced by people trying to cross the border is already daunting.

    Special Report

    Adrift The Invisible African Diaspora

    World Currencies

    EUR
    USD
    0.9017
    JPY
    USD
    104.72
    GBP
    USD
    0.7594
    CAD
    USD
    1.3160
    INR
    USD
    67.046

    Rates may not be current.