The South Asian Association For Regional Economic Integration Issues

Nowadays, it has witnessed that regional cooperation has becoming more vigorous. Regional cooperation as an important part of international economic cooperation emerged after World WarⅡ. In 1985, the seven South Asian countries (Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan, Sri Lanka) established SAARC, hoping to ignore the unpleasant past and strengthen regional cooperation. During that time, they confronted serious international situation and considered to develop regional economy through regional cooperation. When SAARC established, there were varieties of regional organizations.Till 2010, SAARC has been established twenty five years but only hold fifteen SAAR summits, many of which were delayed or cancelled for conflict among member countries especially between India and Pakistan. SAARC charter regulates that bilateral controversy should be excluded from discussion. In 2004, SAARC countries signed SAFTA (South Asian Free Trade Area), which aims at stimulating South Asian regional cooperation to a new level. However economic cooperation without considering political factor is not feasible. In a sense, it will hamper the development of regional trade. Meanwhile, SAARC secretariat is in an embarrassing position for lack of mandate, budgetary, expertise and technology to supervise and convert high-level proposals into action. As far as present situation of SAARC regional economic integration concerned, regional economic cooperation is limited in a certain level. There are many factors hinder its development. If China and South Asian could establish comprehensive trade cooperation, it will be beneficial to both sides. If SAARC free trade area could be accomplished in expected time, it would be favorable to China. Nevertheless, it still has a long way to go.The paper is divided into four parts. Chapter one mainly refers to the theory of regional economic integration and the backdrop when SAARC established. Chapter two explains specific information about SAARC, its principles, structure and connection with international organizations, the role of SAARC in promoting regional cooperation, in particular two phrases after its establishment. Chapter three focus on intra-regional trade, SAFTA rules towards tariff reduction and structure of Industry in South Asia. Moreover, it proposes questions from the above fields. Chapter four analyzes existing problem in South Asian regional economic integration:low level of regional cooperation and lack of common sense among member countries. Besides, it explains why South Asian regional economic integration is in a low level. They are historical factors, political factors, international factors, economic factors as well as realistic elements. Finally, it is conclusion of the paper. There is a slim hope for the finalization of SAFTA.