6.3.12.     SAARC - The countries of South Asia

LEGAL BASIS

Under Article 133 (113) EC, responsibility for commercial policy vis-à-vis third countries lies with the Community. Existing cooperation agreements are based on Article 308 (235) EC. The new third-generation cooperation agreements are based both on Article 133 and on Articles 181 (130y) and 300 (228).

ACHIEVEMENTS

The SAARC's objectives are promotion of human rights and fundamental freedoms, cooperation in the fields of trade, science, technology, action to combat drugs trafficking, and environmental protection.

OBJECTIVES

1. Multilateral relations

a. SAARC (South Asian Association for Regional Cooperation)

- Background:

• The first attempts at cooperation in the South Asian region began at the end of the 1960s, on the initiative of the President of Bangladesh. However, the predominant view was that regional cooperation should not result immediately in the founding of an organisation.
• At the first official meeting on 2 August 1983 the Foreign Ministers of today's SAARC member states (India, Pakistan, Bangladesh, Sri Lanka, Nepal, Bhutan and the Maldives) adopted a declaration on South Asian regional cooperation in which they defined their objectives and adopted an action programme which defines the areas of cooperation.
• The SAARC was formally founded at the first Summit Conference of 7 and 8 December 1985 in Dacca (Bangladesh).

- Activities:

• The centre-piece of economic cooperation among the seven SAARC member states is the South Asian Preferential Trade Arrangement (SAPTA). Its aim is the liberalisation of regional trade by abolishing trade barriers and greater cooperation, since intra-SAARC trade has accounted to date for only 4% of its member states' total trade.
• At the 8th SAARC summit in May 1985 it was agreed that SAPTA would be ratified on 8 December 1995, the tenth anniversary of the SAARC. The long-term goal is to create a free trade area which will comprise 1.2 billion consumers, practically one-fifth of the world population.

b. Relations with the European Union

Europe is the South Asian countries' most important trading partner and a major export market. Development cooperation between the EU and the countries of South Asia covers financial and technical aid as well as economic cooperation. Efforts are being made to give financial support to the institutions and activities of the SAARC: exchange of information, technical aid and training to reinforce the SAARC Secretariat.

2. Bilateral relations

a. India

- The first cooperation agreement concluded in 1973 between the EC and India was superseded in 1981 by a more extensive agreement covering not only trade but also economic cooperation, and then in 1994 by a 'third- generation' agreement. It provides for greater cooperation, particularly in the sphere of trade. Based on adherence to the most-favoured-nation clause it comes under the World Trade Organisation. It also includes dispute resolution and anti-dumping measures. Cooperation covers the industrial and services sector, communications, energy and private investment.

- The EU is India's leading partner as regards external trade and foreign direct investment. In the 1995-1996 financial year, 35% of India's exports went to the EU and 40% of its imports came from the EU. In 1994 bilateral aid from the EU totalled US$ 596 million.

b. Pakistan

In 1986 a commercial, economic and development cooperation agreement superseded the first trade and cooperation agreement concluded in 1976. The new agreement expired in principle in 1991, but has in fact been extended tacitly from year to year. A new 'third-generation' agreement is planned with a view to strengthening economic development cooperation. But this plan has not yet been implemented. It would provide a framework to attract investment capital from the EU Member States. Trade is dominated by textile products from Pakistan, and by machinery and motor vehicle exports from the EU. The United Kingdom and Germany are Pakistan's main trading partners after the United States and Japan.

c. Bangladesh

The 1976 trade and cooperation agreement, initially planned for five years, is still in force today. Included are the promotion of development and diversification of trade and economic cooperation. Also agreed was the reciprocal granting of most-favoured-nation status. The negotiation of a third-generation cooperation agreement is planned.

In the 1996-97 financial year the EU was among the leading economic partners of Bangladesh. Under the Generalised System of Preferences, Bangladesh is granted favourable access to the European market.

d. Sri Lanka

Relations between Sri Lanka and the EU are based on an economic cooperation agreement dating back to 1975. 1994 saw the start of negotiations for a new third-generation partnership and development agreement which will supplement the previous one in the following areas: respect for human rights and democratic principles, trade cooperation based on the most-favoured-nation clause, development and regional cooperation in the fight against drugs trafficking.

The EU is Sri Lanka's leading trading partner. Since 1995 the volume of trade between the two partners has fallen.

e. Nepal

On 20 November 1995 the European Union and Nepal signed, for an initial period of five years, their first cooperation agreement covering the following areas: respect for human rights and democratic principles, cooperation in trade, development, science and technology, energy, agriculture, the environment, and action to combat drugs and AIDS.

f. Bhutan

As yet there is no cooperation agreement between Bhutan and the EU. This country receives development and humanitarian aid from the EU which in 1994 totalled $US 16.8 million.

g. The Maldives

As yet there is no cooperation agreement between the Maldives and the EU. This country receives development and humanitarian aid from the EU. In 1994 bilateral aid from the EU amounted to $US 2.4 million. In 1996 the United Kingdom and Germany were the Maldives' leading trading partners.

ROLE OF THE EUROPEAN PARLIAMENT

1. Multilateral relations

In its resolution of 26 October 1988 on economic relations between the EC and the SAARC, the EP welcomes the founding of the SAARC. It calls upon the Commission to ascertain the areas in which the Community's help is desired. It also looks for an intensification of relations with the SAARC, notably in the form of a cooperation agreement, though it recognises that the initiative should come from the SAARC. It considers that a new delegation must be set up in South Asia as a means of improving contacts with the SAARC member states.

In its resolution of 14 June 1995 on the Commission communication 'Towards a new Asia strategy', Parliament recommends the strengthening of economic, political and cultural ties between the EU and Asia, particularly through increased trade and investment, and a better coordination in the fields of cooperation and development with the most developed countries in the region. It emphasises the efforts made to improve democratic freedoms, human and minority rights, social rights, and health and environmental protection regulations. Finally, it reiterates its call for the speedy opening of new EU representative offices.

An EP delegation maintains relations with the parliaments of the countries of the region.

2. Bilateral relations

a. India

- In its resolution of 22 April 1994 on economic and trade relations between the European Community and India, the EP welcomed the negotiation of the new cooperation agreement. It also noted the decisive importance of the input of private investment capital alongside public development aid for the realisation of India's economic potential.

- On the occasion of the nuclear tests conducted in May 1998 by India, and then by Pakistan, the EP expressed deep concern at the danger posed by these tests for peace, security and stability in the region and in the world. It urged the Indian and Pakistani governments to refrain from any further tests, to adhere to the nuclear non-proliferation treaty without any modification of its terms, immediately and unconditionally to endorse the nuclear test ban treaty, and to start forthwith a dialogue in order to reduce tensions in the region, to establish a framework for reconciliation and cooperation, and so promote peace, security and stability in South Asia and throughout the continent.

b. Pakistan

- On 22 April 1994 the EP adopted a resolution on economic and trade relations between the Community and Pakistan. It notes therein the importance of Pakistan's membership in SAARC but recognises that progress will be difficult, in view of the tensions persisting in the region, in particular in Kashmir.

- The EP is particularly concerned about the human rights situation in Pakistan. It points out that Pakistan's Commission on Human Rights pronounced 1997 the most disastrous year in the country's entire history. The situation of the religious minorities, some of whose members have been arrested, held without reason and sentenced to long terms of imprisonment, is very uncertain. The EP calls on the Pakistan Government to do all it can to improve the situation of the religious minorities, emphasising the importance attached by the European Union to respect for human rights, which forms part of the agreement currently being negotiated.

c. Bangladesh

- The EP expressed concern at the violation of human rights in the Chittagong Hill Tracts. It condemns the repression of the indigenous population and the attacks on its fundamental freedoms such as freedom of movement and of political and cultural expression. The EP believes it is urgently necessary to stop all colonisation and militarisation of the region, in order to foster the search for a solution to the conflict. It calls on the Bangladesh Government to allow unrestricted visits by delegations from humanitarian and human rights organisations, and to ensure full freedom of movement for the local population.

- The EP recently expressed alarm over the situation of Talisma Nasreen, winner of the Sakharov Prize, who was forced to leave Bangladesh and seek refuge in the European Union to escape arrest on a charge of blasphemy. The EP urges the Bangladesh authorities to do everything possible to safeguard her security, to terminate all the judicial proceedings against her, and to allow her to travel freely.

d. Sri Lanka

The EP has repeatedly stated its views on the political situation in Sri Lanka, particularly drawing attention to the need for human rights to be respected and for support for the peace process in the resolution of the ethnic conflict between the Cingalese majority and the Tamil minority.

e. Bhutan

The EP expressed concern over the situation of some 100 000 Bhutanese refugees in Nepal and India. It called on the Bhutanese Government to take the necessary measures for their return, under the aegis of the UNHCR, and to respect minority rights on its territory.

01/12/2000