South Asian CEOs to form regional grouping

South Asian CEOs to form regional grouping

Agence France-Presse New Delhi

South Asian corporate chiefs plan to launch a forum to push for free trade and investment in the region ahead of a seven- nation summit in Islamabad, an Indian trade leader said on Friday.

Ajay Khanna, deputy director general of the Confederation of Indian Industry, said the chief executive officers will set up the forum by video conference and draft a joint statement for the seven nations' leaders.

"We want to build South Asia as a manufacturing and outsourcing hub for the world. We want to remove all barriers in the way of the tremendous intellectual talent here," he said.

"We are basically interested in a South Asian economic union which can be achieved by harmonizing the industry standards," he said.

Khanna recommended a regional bank to mold economic policy, more cooperation in tourism and a lifting of restrictions on people's movement within the politically troubled region.

He added that close cooperation will enable the smaller South Asian nations to accelerate their economies as they would be able to tap into the vast Indian economy which in the second quarter saw booming 8.4 percent growth.

Hopes for strong trade in the region have been fanned by the warming ties between India and Pakistan, whose rivalry has repeatedly set back progress of the South Asian Association for Regional Cooperation (SAARC).

South Asian foreign ministers were meeting on Friday in Islamabad to hammer out the draft South Asian Free Trade Agreement (FTA) and an agreement on fighting poverty.

Only five percent of the international trade of SAARC countries -- Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan and Sri Lanka -- is within the region, Khanna said.

In comparison, it is around 65 percent in the European Union and 22 percent in ASEAN, the Southeast Asian bloc, he said.

SAARC heads of state and government are due to open a summit on Sunday for the first time in two years.