Accelerating Regional Cooperation in BIMSTEC

Syllabus: GS2/ Agreements Involving India &/or Affecting India’s Interests

In Context

• India recently seconded a senior diplomat to drive BIMSTEC as its fourth Secretary-General (SG).
  • Accelerating regional cooperation in BIMSTEC is going to be the defining task of the new Secretary-General.

BIMSTEC

• About: The Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC) is a multilateral regional organisation. 
• Aim: It was established with the aim of accelerating shared growth and cooperation between littoral and adjacent countries in the Bay of Bengal region.
• Origin and Membership:  It was founded as BIST-EC, in June 1997, with the adoption of the Bangkok Declaration, with Bangladesh, India, Sri Lanka and Thailand as members.
  • It became BIMST-EC (Bangladesh, India, Myanmar, Sri Lanka and Thailand Economic Cooperation) with the entry of Myanmar in late 1997, And eventually, it was named in its current form, when Nepal and Bhutan became members in 2004.
• Strength: The BIMSTEC region hosts 22% of the world population or 1.68 billion people; and the member states have a combined GDP of US$3.697 trillion/per year.
• Working Mechanism: Policy making would be done through two types of meetings:
  • Summits, which are supposed to be held every two years; and 
  • Ministerial meetings of Foreign and Commerce Ministers of member countries for deciding on trade and economic affairs, to be held once every year. An operational meeting of senior officials to monitor the activities of the grouping is also supposed to be held twice a year.

Significance 

• Need of formation: The Bay of Bengal region was one of the world’s most integrated regions until the early twentieth century.
  • But, after the 1940s, members of the region became independent and pursued separate goals and alliance systems, the region’s sense of community has almost completely eroded.
• So, the aim of setting up the regional grouping was not to create a new region for cooperation but to revive the connectivity and common interests of the members of the Bay of Bengal region. 

• Acting as a bridge: Its significance lies in the fact that it serves as a direct link between South Asian and South East Asian countries through intra-regional collaboration.
  • It represents a reinforcement of relations among these countries.
• Sector-driven approach: What makes BIMSTEC different from other regional groupings such as SAARC or ASEAN is that it is a sector-driven organisation. 
  • This means the goals or areas of cooperation are divided between members, for instance, out of the multiple sectors like trade, energy, transport, fishery, security, culture, tourism and so on.
    • For example, India was made responsible for areas like transportation, tourism and Counter-Terrorism earlier. 
    • After which, India was BIMSTEC’s pillar for security; this will include areas of counter Terrorism and Transnational Crime (CTTCC) Disaster Management and Energy.
• Alternative to SAARC: The progress of SAARC has stalled over the years due to Indo-Pak relations and what experts call Pakistan’s obstructionist approach to the organisation.
  • BIMSTEC emerged as an alternative platform for cooperation.

India & BIMSTEC

• Importance of BIMSTEC for India: For India, BIMSTEC aligns with its ‘Act East’ policy for greater regional cooperation in southeast Asia.
  • It could also be seen as aligning with India’s larger goal to gain trade and security prominence in the Indian Ocean region and to cater to the concept of the ‘Indo-Pacific’ region, a major focus of Quad countries.
  • Another important factor for India in becoming a prominent leader in the Bay of Bengal and maintaining peace and security.
• India’s efforts: India also made efforts to enhance the pace of BIMSTEC’s progress in recent years.
  • The BIMSTEC Energy Centre was set up in Bengaluru, along with the BIMSTEC Business Council, a forum for business organisations to promote regional trade.
    • It aims to create free-trade and power grid interconnectivity agreements, and a masterplan for transport connectivity in the Bay of Bengal region.

Challenges

• Sluggish pace: The first and major challenge, according to foreign policy researchers, is a lack of efficiency and “sluggish” pace of BIMSTEC’s progress.
  • The inconsistency in holding policy making and operational meetings is also a concern. 
• Inadequate assistance: BIMSTEC secretariat also suffers from inadequate financial and manpower assistance for its operational activities.
• Trade challenges: India’s percentage of annual trade with BIMSTEC countries as a percentage of its total foreign trade was in the double digits in the 1950s, but was just 4% as of 2020. 
  • Inter-regional trade within BIMSTEC countries also varies significantly; research shows that member countries trade with each other in terms of the proximity, availability of trade routes and the size of the country’s economy. 
  • Notably, it was also seen that a lot of the time, BIMSTEC member countries don’t import goods that are manufactured and exported by other members, instead importing from other non-member countries.
• Absence of connected coastal ecosystem: BIMSTEC members are yet to build a shared and lucrative coastal shipment ecosystem and also grapple with frequent detention of fishermen who cross territorial borders.
• Challenges faced by members: In recent years, the progress of BIMSTEC has also been underscored by Bangladesh-Myanmar relations over the Rohingya refugee crisis, the India-Nepal border issue, and most recently, the political situation in Myanmar.
  • The first half of 2024 may witness elections in Bhutan, Bangladesh, India and Sri Lanka. Most likely, there will be further delay in holding the Summit.  

Suggestions & way ahead

• Trade is one of the priority areas of the BIMSTEC.
  • The progress needs to be made in the BIMSTEC Free Trade Agreement (FTA). 
• BIMSTEC’s connectivity plan is ready, but the real implementation is yet to start.
  • Since the BMCA is ready, the Secretariat may pick up the maritime sector (example, ports, IWT, and shipping) as low-hanging fruit to start with. Besides, trade and transit facilitations must be given top priority along with energy and digital connectivity.
• Overall, a stronger secretariat is a must to drive meaningful interactions among member-states.