Nitin Gadkari, India’s minister of road transport and highways and shipping, on June 15, 2015 in Thimphu at the meeting of transport ministers of Bangladesh, Bhutan, India and Nepal (BBIN) announced the signing of the Motor Vehicles Agreement (MVA) for regulation of passenger and cargo vehicular traffic amongst the four countries. Also present in Thimphu,at this historic occasion for South Asia, were the prime minister of Bhutan, Bangladesh’s minister of transport and bridges, Nepal’s minister of physical infrastructure and transport, and the vice-president of the Asian Development Bank (ADB).
The BBIN-MVA is the culmination of the collaborative effort of four countries and will facilitate seamless movement of passenger, personal and cargo vehicles in the territories of each other. The signing of the agreement will be followed-up by formulation of the required protocols and procedures to eventually allow motor vehicles of all categories registered in BBIN countries to move freely in the region, seen as a small first but significant step in deepening regional integration. This article looks at the strategic impact of the BBIN-MVA.
Route to BBIN-MVA
South Asian Association for Regional Cooperation (SAARC) intra-regional trade is mere 5 percent between the South Asian nations despite a free trade pact which was signed in 2006. This has been attributed mainly to lack of integration of transportation networks and very high cost of logistics in South Asia which ranges between 13-14% of the commodity value, compared to 8% in USA. The SAARC Charter (Article VII) promotes the idea of sub-regionalism, and attempts at sub-regional cooperation within SAARC go as far back as 1996 when the idea of South Asia Growth Quadrangle (SAGQ) was put forth. Attempting transport integration at sub-regional level too has been on the cards for some time.
At the first SAARC transport ministers’ meeting in New Delhi in August 2007, India had proposed two inter-regional road corridors along the Nepal-India and Bangladesh circuit apart from a rail corridor from amongst a set multi-modal transport routes suggested in the SAARC Regional Multi-Modal Transport Study or SRMTS (proposed at the 2004 summit) submitted to the SAARC Secretariat in June 2006. The SRMTS had identified ten road corridors, five rail, two Inland Water Transport corridors, 10 maritime and 16 aviation gateways, for regional transport connectivity. The implementation of the SRMTS recommendations has been slow due to lack of political commitment besides a host of physical and non-physical barriers.
The BBIN-MVA is an “overarching” framework which gives ample flexibility to each country to take steps to operationalise the agreement as per their individual requirements to ensure smooth cross border flow of goods, services, capital, technology and people. The BBIN-MVA is just the protocol for sub-regional cooperation; it will require scaling up of transport infrastructure (and finance) including construction and upgrading of roads, railways, waterways, air links, energy grids and communications. Transport infrastructure, besides national and bilateral programmes, is also being funded and created under multilateral initiatives such as the BIMSTEC, SASEC, BMIC, UNESCAP ect
In November 2014, during the SAARC summit in Kathmandu Pakistan did not allow the conclusion of both the SAARC MVA and SAARC Railways Agreement, as it was yet to complete its “internal process”. This came after the draft text of the MVA for SAARC had been decided upon during the transport experts’ level meeting at Neemrana earlier in the year. The Pakistani reluctance was seen as impeding regional connectivity and integration among South Asian nations. It was possibly the Pakistani position at Kathmandu that provided the final push for sub-regional connectivity among India’s eastern neighbours and the BBIN-MVA.
During Afghan President Ashraf Ghani’s visit to Delhi on April 27-28 the two countries agreed to sign, within three months of the visit, a MVA for the regulation of passenger, personal and cargo vehicular traffic between India and Afghanistan. India also conveyed its intent to be the fourth party to the recent PATTTA (Pakistan, Afghanistan, Tajikistan Trade and Transit Agreement).
However, these decisions were largely symbolic in nature without Pakistan’s acquiesce to Indian participation and were possibly intended to send a message to Pakistan and to the SAARC community indicating how Pakistan’s refusal to sign the SAARC MVA at the Kathmandu summit was detrimental to regional interests. Yet in the interest of regionalism the positive spin remains that Pakistan can move ahead within SAARC when it is ready.
There may also be this realisation in New Delhi that the Pakistani position on SAARC MVA may not be just limited to isolating and pressuring Afghanistan to heed Pakistani interests but Pakistan may be looking to leveraging its geographic location to create its own economic ecosystem with China, Afghanistan and the Central Asian countries.
In this context Prime Minister Narendra Modi’s visit to Bangladesh and the consequent agreements on integration of transport networks provided just the opportunity India was seeking to provide momentum to BBIN sub-regional cooperation. The transport minster in Thimpu also announced that a consensus had been arrived at between India-Myanmar and Thailand, during their second meeting at a secretary level discussion at Bengaluru on June 2-3, on the text of a similar framework MVA for the three nations which would facilitate movement on the trilateral highway. Once signed, this agreement would enable the integration of Myanmar and Thailand through the trilateral highway with the BBIN corridor. This places BBIN MVA as an enabler within India’s policy of ‘Act East’ under which it is proactively looking to build effective and credible links between South Asia and South East Asia.
The Dragon’s Shadow
Amidst the clamour by some of the member states for granting primary membership of SAARC to China during the summit at Kathmandu in November 2014, Modi would have discerned two economic drivers for this request; requirement of Chinese funding and connectivity.
Vis-a-vis China and its silk routes (One Belt One Road), conclusion of the BBIN-MVA within SAARC achieves an important position – it will ensure that the SAARC members would have assessed (and to an extent experienced) the potential benefits that connectivity and integration brings to South Asia. They would also have, importantly, appraised in depth what serves their individual national interests best, before they negotiate with China on joining the OBOR, individually and as a region. This will make certain a complete understanding and clarity to SAARC member states as to what the OBOR should be doing for them rather than the reverse.
From the Indian perspective it should be SAARC energy that drives regional integration rather than individual member states looking over the Himalayas to meet their requirements of connectivity and efficient transportation.
*Monish Gulati is Associate Director (Strategic Affairs) with the Society for Policy Studies. He can be contacted at [email protected]
This article was published by South Asia Monitor.