development challenges facing south and south … and social commission for asia and the pacific...

DEVELOPMENT CHALLENGES INSOUTH AND SOUTH-WEST ASIA

VIEWS FROM THE SUBREGION

April 2012

DEVELOPMENT PAPERS 1201 Subregional O!ce for South and South-West Asia

ESCAPSUBREGIONAL OFFICE FOR

SOUTH AND SOUTH-WEST ASIA

Developing Challenges Facing South and South-West Asia: Views from the Subregion April 2012

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Disclaimer: The views expressed in this Development Paper are those of the author(s) and should not necessarily be considered as reflecting the views or carrying the endorsement of the United Nations. Development Papers describe research in progress by the author(s) and are published to elicit comments and to further debate. This publication has been issued without formal editing. Subregional Office for South and South-West Asia (SRO-SSWA) Economic and Social Commission for Asia and the Pacific (ESCAP) C-2 Qutab Institutional Area, New Delhi-110016, India Email: [email protected] Dr. Nagesh Kumar, Director

mailto:[email protected]

South and South-West Asia Development Papers 1201 April 2012

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DEVELOPMENT CHALLENGES FACING SOUTH AND SOUTH-WEST ASIA: VIEWS FROM THE SUBREGION

Report on the High-Level Policy Dialogue on Development Challenges Facing the Subregion, Taj Mahal Hotel, New Delhi, 15-16 December 2011

Abstract

This paper presents the report of the High-level Policy Dialogue on Development Challenges Facing the Subregion (New Delhi, 15-16 December 2011), which was organized to coincide with the opening of the United Nations ESCAP Subregional Office for South and South-West Asia (SRO-SSWA) based in New Delhi. The report outlines the key recommendations which emerged from the Policy Dialogue, which was attended by nearly 200 participants from 17 member States of ESCAP, representing senior officials, representatives of United Nations bodies and specialized agencies, intergovernmental organizations and civil society. The report then summarizes the salient points of the discussions, which focused on a range of topics related to key development challenges facing South and South-West Asia. This report will provide a basis for the future work programme of the newly established ESCAP SRO-SSWA. JEL code(s): O20, O53 Keywords: Development, South Asia, Turkey, Iran


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CONTENTS

Chapter Page

I. EXECUTIVE SUMMARY AND KEY RECOMMENDATIONS 7

II. PROCEEDINGS

A. Background 10

B. Inaugural Session and Interactive Dialogue of Ministers and Policy Makers 5 from Member countries with Professor Amartya Sen

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C. Global Economic Turmoil and Economic Outlook of South and South-West Asia 10 15

D. MDGs, Poverty Reduction and Inclusive Development: Development Agenda for 2015 and Beyond

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E. Rising Food Prices and Food Security: Policy Options for South and South-West Asian Countries

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F. Regional Economic Cooperation and Connectivity in the Subregion: Potential and Challenges

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G. Sustainable Development and Rio+20 Agenda: A Subregional Perspective 22

H. Partnerships for Development of Countries with Special Needs: Implementing the Istanbul Programme of Action and Almaty Programme of Action in South

Asia

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I. Closing Session 26

ANNEX

Programme 27


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DEVELOPMENT CHALLENGES FACING SOUTH AND SOUTH-WEST ASIA: VIEWS FROM THE SUBREGION

I. EXECUTIVE SUMMARY AND KEY RECOMMENDATIONS

1. The High-level Policy Dialogue on Development Challenges Facing the Subregion (New Delhi, 15-16 December 2011) was organized to coincide with the opening of the ESCAP Subregional Office for South and South-West Asia (SRO-SSWA) based in New Delhi. The Policy Dialogue was divided into seven substantive sessions which highlighted key development challenges facing the subregion. The event attracted high-level representation, bringing together nearly 200 participants, including senior ministers, policymakers and officials from the member countries of ESCAP, heads of policy think-tanks and members of diplomatic community and civil society in India and other SSWA countries, namely: Afghanistan, Bangladesh, Bhutan, the Islamic Republic of Iran, the Maldives, Nepal, Pakistan, Sri Lanka and Turkey.

2. The Policy Dialogue was inaugurated by Dr. Noeleen Heyzer, Under-Secretary-General of the United Nations and Executive Secretary of ESCAP and a highlight of the event was the keynote address delivered by Nobel Laureate Professor Amartya Sen, , T.W. Lamont Professor at Harvard University,. This was followed by an interactive dialogue between senior ministers and policymakers from the subregion and Professor Sen. This important session, moderated by Dr. Heyzer, generated an inspiring debate over the development priorities of and challenges facing the subregion, providing valuable insights into the key areas that the SRO-SSWA may focus upon in its future work programme. In particular, it was noted that the subregion had emerged as one of the most dynamic subregions in the world, yet it faces a plethora of development challenges including widespread rural poverty and hunger. In that context, Professor Sen advocated the promotion of inclusive development policies in order to translate economic growth into a significant improvement in people’s wellbeing while drawing priority attention to neglected issues such as the extremely high levels of child malnutrition and maternal mortality in India and the subregion. With regard to strategies for maintaining the momentum of economic growth in South and South-West Asia, Professor Sen noted that given the turbulent economic climate in many developed countries, efforts had to be made to find alternative sources of growth, through demand creation both domestically and within the subregion.

3. The second session focused on the global economic turmoil and economic outlook of South and South-West Asia. The participants noted the timeliness and relevance of this topic, in light of the prevailing negative economic climate in the developed markets and which affects many countries in the subregion, particularly vulnerable segment of the society. The Policy Dialogue discussed a range of issues including the recent Eurozone debt crisis and its implications for countries in the subregion. In this respect, the participants underscored the


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importance of greater cooperation among countries in South and South-West Asia in order to tackle such global challenges in a more coherent manner.

4. The third session of the Policy Dialogue focused on the Millennium Development Goals (MDGs), poverty-reduction related issues and the way forward for the development agenda beyond 2015. The participants highlighted the immense value of the existing MDG framework for working coherently towards a common goal and shared their perspectives with regard to the shape and scope of the post-2015 development agenda. One common priority arising from the discussion was a need to revisit the development paradigm, broadening it and capturing other dimensions which contribute to people’s wellbeing. A number of dimensions were mentioned including material living standards; health; education; personal activities, including work; political voice and governance; social connections and relationships; environment; and insecurity.

5. A key conclusion of the dialogue was that food prices and food security, the topic of the fourth session, should be a high priority in the work of the SRO-SSWA as higher food prices and ensuing food shortages have led to widespread hunger, severely affecting the poor and vulnerable. It is imperative to understand the underlying causes of volatility in food prices and frame appropriate policy responses. The latter should incorporate both short-term and long-term perspectives, while striking a delicate balance between the concerns of consumers and those of producers. In this regard, a range of policy responses were discussed, both at the domestic level to boost agricultural production and improve productivity, and at the regional and international levels, to enhance cooperation and mitigate the unacceptable level of price volatility in commodity markets which can be strongly influenced by financial speculation.

6. A central theme of the Policy Dialogue was the means to accelerate and broaden regional cooperation and connectivity which offers both unique opportunities and requires overcoming various challenges. The Dialogue noted the prominence that the SAARC Summit in 2011 had accorded to these two themes: connectivity and building trade linkages. It was also noted that important complementarities exist between the countries in the subregion and that consequently more could be done to reap the full potential of enhanced regional cooperation. Sharing of experiences and lessons learned from various initiatives could enhance regional cooperation, including infrastructure projects in the region, served by the Tehran-based Economic Cooperation Organization (ECO). Reducing various forms of trade barriers and harmonizing transit formalities and regulations could lead to greater specialization and the realization of economies of scale which would eventually contribute to greater diversification and enhanced competitiveness.

7. The sixth session focused on issues pertaining to the pursuit of sustainable development, defined as development that respects ecological constraints and the imperatives of social justice. The session highlighted environmental degradation as a factor that can perpetuate poverty, in particular when it impacts soil fertility, quantity and quality of water, air, forests, wildlife and fisheries. The participants noted the many challenges confronting the


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countries in the subregion and shared good practices towards achieving sustainable development objectives.

8. The final session of the Policy Dialogue was devoted to specific development challenges faced by countries with special needs, especially the Least Developed Countries and Land-Locked Developing Countries, and the course of action required to accelerate the implementation of the Istanbul and Almaty Programmes of Action. Considering the high vulnerability to external shocks and persistent structural weaknesses of this group of countries, it was recognized that genuine North-South and South-South partnerships were of paramount importance.

9. Over the course of the two-day Policy Dialogue, a number of recommendations emerged which will guide the work of the newly established SRO-SSWA in New Delhi. Among other issues, ESCAP SRO-SSWA was called upon to:

Work closely with State and Non-State actors for achieving inclusive growth in SSWA, helping identify new sources of strong growth in the subregion and promoting policies to improve people’s well-being and close development gaps, in areas such as health, education, gender equality and women’s empowerment, access to water, nutrition and sanitation, and social protection programmes through sharing of best practices across the region;

Advocate policies towards deepening regional cooperation and integration to promote continued development of the subregion as cross-border investment, trade, and financial market integration help build productive capacity, foster industrial upgrading and restructuring, and connect emerging sources of domestic demand across the subregion, working closely with other regional organizations such as SAARC, BIMSTEC, ECO, Asian Development Bank, among others;

Strengthen regional cooperation to enhance food security in close cooperation with regional bodies and address issues related to energy security. Act as a catalyst in reviving infrastructure connectivity across the subregion to enable South and South-West Asia to re-emerge as the hub of activity between markets in West, Central and East Asia;

Promote South Asian identity and its integration with other subregions of Asia-Pacific in a broader Asian economic community;

Articulate and develop proposals for mobilizing Asian savings for productive investments in the region to close infrastructure development gaps, especially in the SSWA region;

Support governments in the subregion, particularly LDCs and LLDCs, with more focused and in-depth technical assistance to address their specific development


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challenges and needs through capacity-building activities and advisory services, thereby operationalizing the analytical and normative work of ESCAP, as a whole.

II. PROCEEDINGS

A. Background

10. As a part of the Secretary-General’s pledge to strengthen the United Nations’ development pillar and ESCAP’s endeavour to assist its member States in the South and South-West Asian region to formulate and implement inclusive and sustainable development policies for the achievement of the Millennium Development Goals, the ESCAP Subregional Office for South and South-West Asia was established and officially launched as part of a two-day high-level policy dialogue held on 15 and 16 December 2011 at the Taj Mahal Hotel, New Delhi. The Office will serve to facilitate the sharing of development experiences and to promote regional economic cooperation, as South Asia emerges as one of the most dynamic subregions of the world.

11. The High-level Policy Dialogue on Key Development Challenges Facing the Subregion was organized to benefit from the perspectives of senior policymakers and experts of the South and South-West Asian countries with regards to key development issues which the new Office may focus upon through its work programme. The Policy Dialogue was also meant to facilitate the exchange of development experiences and good practices.

12. The participants welcomed the establishment of the new Office as a key development partner of the subregion that could assist it in achieving the MDGs and narrowing the development gaps. For example, the Office could assist the subregion unleash its potential for inclusive and sustainable growth by focusing on regional economic integration and on enhancing the productive capacities of poorer countries in the subregion. They also wanted the Office to help the subregion articulate its collective voice on global and regional issues and exploit the potential for financial cooperation in the subregion and beyond, including by developing a development-friendly regional financial architecture.

13. The High-level Policy Dialogue brought together nearly 200 participants, including senior policymakers and officials from the member countries of ESCAP, including from Afghanistan, Bangladesh, Bhutan, Japan, India, the Islamic Republic of Iran, the Maldives, Nepal, Pakistan and Sri Lanka, Ambassadors of ESCAP member States especially in the subregion, heads of policy think-tanks in India and other SSWA countries, members of the UN Country Team in New Delhi including heads of subregional and country offices of different UN agencies including the United Nations Development Programme (UNDP), the UNAIDS, UN Women, the United Nations Office on Drugs and Crime (UNODC), the World Health Organization (WHO), the United Nations Information Centre for India and Bhutan (UNIC), the International Labour Organization (ILO), and .members of academia, civil society and media.


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14. The Policy Dialogue was inaugurated with an opening address by Dr. Noeleen Heyzer, Under-Secretary-General of the United Nations and Executive Secretary of ESCAP, and a keynote address by Nobel Laureate Professor Amartya Sen of Harvard University. Other distinguished participants included H.E. Dr. Sarath Amunugama, Senior Minister of International Montery Cooperation, Government of Sri Lanka and Chairperson of the 67th session of ESCAP; H.E. Dr. Sham L. Bhathija, Senior Advisor-Minister for Economic Affairs to the President of Afghanistan; H.E. Dr Ibrahim Hussain Zaki, Special Envoy of the President of Maldives; H.E. Dr Hafeez Pasha, Convenor of Economic Advisory Council to the Prime Minister of Pakistan and former Finance Minister of Pakistan; Professor Rahman Sobhan, Chairman, Centre for Policy Dialogue, Dhaka; Dr. Atiur Rahman, Governor of Bangladesh Bank; H.E. Mr Daw Tenzin, Governor, Royal Monetary Authority; Mr Omer Azizullah, Deputy Director General of Economic Affairs, Ministry of Foreign Affairs, Afghanistan; H.E. Mr Gauri Pradhan, Member, National Human Rights Commission, Nepal; H.E. Mr. Davood Manzour, Deputy Head of Planning, Presidential Office, Islamic Republic of Iran, Tehran; H.E. Mr. M. Yahya Maroofi, Secretary-General, Economic Cooperation Organization Secretariat (ECO), Tehran; and Dr. Mohan Man Sainju, Chairman, Institute of Integrated Development Studies, Kathmandu, also former Vice Chairman, Planning Commission of Nepal, besides several eminent experts from India.

15. Over 165 participants attended the Policy Dialogue, including representatives from 17 member States of ESCAP, namely Afghanistan, Australia, Bangladesh, Bhutan, China, France, India, the Islamic Republic of Iran, Japan, Malaysia, the Maldives, Myanmar, Nepal, Pakistan, Papua New Guinea, Russia and Sri Lanka. In addition, representatives of the following United Nations bodies and specialized agencies attended: the International Fund for Agricultural Development (IFAD), the International Labour Organization (ILO), the Joint United Nations Programme on HIV/AIDS (UNAIDS), the United Nations Development Programme (UNDP), UN Women, the World Health Organization (WHO) and the World Food Programme (WFP), besides the United Nations Information Centre and the United Nations Millennium Campaign. The following intergovernmental organizations were represented: Asian Development Bank (ADB), Economic Cooperation Organization (ECO) and the South Asian University. Representatives of prominent think-tanks in the subregion and media outlets were also in attendance.

B. Inaugural Session and Interactive Dialogue of Ministers and Policymakers from Member Countries with Professor Amartya Sen

16. Dr. Nagesh Kumar, Chief Economist of ESCAP and Director, SRO-SSWA welcomed all participants and underscored the historical significance of the day, which marked the culmination of ESCAP’s efforts to come closer to its member States to serve them more effectively and ensure subregional specificities are adequately addressed in its work. He highlighted the great economic diversity which characterizes the subregion, making cooperation especially beneficial. He said that the new Office would strive to assist member States make the most of opportunities for inclusive and sustainable development and hoped


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the ensuing High-level Policy Dialogue and statements would provide invaluable source of inspiration for the work of the Office.

17. In her opening address, Dr. Noeleen Heyzer, Under-Secretary-General of the United Nations and Executive Secretary of ESCAP stressed that the opening of the Subregional Office marked a major milestone in realising the United Nations’ potential to better serve the people of the Asian and Pacific region. She noted that the subregion had emerged among the most dynamic subregions in the world, though it faces a plethora of development challenges. One of the primary goals of the Office would be to assist the subregion in unlocking its dynamism and addressing development challenges, also facilitating the sharing of experience and promoting economic cooperation. The Executive Secretary highlighted the subregion’s exceptional contribution to the world over the past centuries and expressed the firm belief that the subregion had the potential to regain a position of economic leadership in the first half of this century. Acknowledging the many challenges it faces, such as high levels of poverty, hunger and maternal mortality, as well as inadequate infrastructure and rising inequalities, she stressed the urgent need to focus on poverty reduction and on closing the development and gender gaps, while allowing for the subregion’s pioneering experiments in inclusive development to be up-scaled and replicated around the world. Enhanced connectivity and regional economic integration would offer new possibilities to leverage emerging countries’ dynamism for closing the development gaps. She thanked the Government of India for the support extended to ESCAP for establishing this new Subregional Office.

18. Professor Amartya Sen, Nobel Laureate, T.W. Lamont University Professor, Harvard University in his keynote address, covered a wide range of priority development issues that confront countries in the subregion and which may be addressed in the work programme of the new Office. He urged policymakers not to commit the same mistakes as the West but to try and learn lessons from others, making an analogy to the ancient Indian board game of snakes and ladders. He expressed hope that Asia could strengthen its voice at G20 summits, yet being mindful that many countries in the subregion are not part of that Group. He highlighted the fact that the translation of economic growth into a significant improvement in people’s wellbeing had been far too slow and that one had to find ways to maintain the momentum of economic growth, however, paying due attention to human development. Given the turbulent and unstable economic environment in the West, efforts must be made to find alternative sources of growth, by demand creation both domestically and within the region. In this context, he said that a useful lesson could be learnt from Latin America, in particular Brazil and Argentina who have made significant strides in the area of regional economic integration and demand creation by reducing the inequalities. While economic growth in itself and for its own sake was not sufficient, he stressed that policies for other gains including social development had to be pursued. Noting the wide income disparities that exist in countries such as India, he called for a re-examination of priorities. He highlighted many neglected issues including the unacceptably high levels of child malnutrition and maternal mortality in India (comparable to or worse than levels in Sub-Saharan Africa). He called for a reallocation of government budget to resolve these burning


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issues. He also ed the need to end corruption, and did not endorse processes that take place outside the institutional arrangements of a democratic system.

19. Professor Amartya Sen’s keynote address was followed by an interactive dialogue moderated by Dr. Noeleen Heyzer in which senior policymakers from around the region participated.

20. Dr. Sarath Amunugama highlighted the many roles that the Subregional Office could play, in the broad context of the global economic and financial crises which affect the subregion and in light of the wide disparities existing within and among countries in the subregion. He noted that inclusive growth was an imperative and that the Office could provide leadership for achieving that in the subregion, based on those few Asian economies driving global growth and also drawing on the intellectual debate generated during the High-level Policy Dialogue. Dr. Amunugama also shared Sri Lanka’s experience with regard to inclusive growth, noting that his country had enjoyed an average of 6 per cent growth over the past five years. He said that growth had been extensively delayed, following 28 years of ethnic conflict which came to an end some three years ago. Inclusive growth was now being achieved thanks to a process of integration of different regions of Sri Lanka, as well as a commitment to the following key elements: Significant investment in agriculture (Sri Lanka is to become a rice exporting country and the country’s tea crops are also faring extremely well) and sustained attention accorded to lagging/poorer areas of the country. In this connection, Dr. Amunugama highlighted the critical role played by migration in the process of development, his country accounting for 1.6 million migrant workers remitting about USD5 billion a year. He noted that this represented one of the largest sources of foreign exchange and that the underprivileged sections of the society were direct beneficiaries of these movements of capital, a process at times even more effective than governmental actions. Finally, democracy was highlighted as another crucial factor in sustaining inclusive growth.

21. Dr. Sham Bhathija welcomed the establishment of the ESCAP Subregional Office and noted that the Government of Afghanistan would work closely with the new Office. He felt that the Office could provide more focused and in-depth technical assistance to address key development challenges, through capacity-building activities and advisory services, and the implementation of projects. He further stated that the Office could work as a catalyst to operationalize the analytical and normative work of ESCAP. He highlighted that three decades of conflict had inflicted deep suffering on the Afghan people and that today the country was left with a complex set of challenges, including terrorism, socio-economic deprivation, drug production and trafficking, deteriorating ecology and weak infrastructure. Those challenges continued to inhibit economic growth and hamper the return to normal life for Afghan people. While quoting President Hamid Karzai, he underscored that the future of Afghanistan would depend on the prospects of economic integration in the subregion and hoped that the Subregional Office would help foster it.


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22. Professor Rahman Sobhan welcomed the historical establishment of the new Office against the background of transformation of South Asia from a lagging overpopulous subregion into a dynamic one and a legitimate partner for the broader Asian regional community in the making of the Asian Century. Professor Sobhan expected the SRO-SSWA to play a key role in several areas such as helping define the specific identity of South Asia with a South Asian Community. He hoped that the SRO could play an important role in helping to revive the land-links or connectivity across the subregion to enable South Asia to re-emerge as the hub of West, Central and East Asian markets, generating a whole range of opportunities. It could help reconfigure the global economic architecture with a broader Asian economic community bringing together West Asia, South Asia, and East Asia given the huge interdependence between these subregions in terms of producers and consumers of energy resources and of labour. In the context of Asia’s emergence as source of capital that is presently underwriting budget deficits of western advanced economies, it could assist in realigning global financial architecture to create a new institutional architecture such as an Asian Monetary Fund. This Fund, in which South Asia would have a major stake, could assist in unlocking the potential of financial cooperation for closing the development gaps. The SRO could also assist position the demographic capital of the subregion as a major resource in the context of poverty reduction, and to unleash the potential of the ‘bottom billions’ as producers and consumers for sustaining the dynamism of the subregion and beyond. The SROcould help to highlight the strong democratic traditions of the subregion which need to be integrated with economic democracy to make political democracy sustainable. The Office could exploit the strength of the South Asian civil society and work with subregional bodies such as SAARC for building a South Asian community. Professor Sobhan also emphasized the vital importance of addressing gender issues, as an integral part of the development process without which sustainable and inclusive development cannot be achieved. He hoped the SRO could enhance the awareness in the region about the central role of women in the development process and highlight the need to address the gender dimensions of democracy so that women are not excluded from that process.

23. Dr. Hafiz Pasha, Convenor, Prime Minister’s Economic Advisory Council, Government of Pakistan and former Finance Minister of Pakistan commended ESCAP for opening a new office and expressed hope that it would promote progress in the region towards the goals of shared peace, prosperity and solidarity as well as boost the subregion’s overall identity and image. He noted that the 2011 South Asia Human Development Report was dedicated to Pakistan’s economist Mahbub ul Haq and Nobel laureate Amartya Sen, who pioneered the Human Development Index and the Human Development Reports. Pakistan is one of the very few countries in the world that has established a Human Development Centre, he said, highlighting the many publications such as regional Human Development reports that the Centre has been producing over the past 12 years. Dr. Pasha noted the multidimensional threats to security that his country was facing and said his country was at the frontline of the global war on terror. He said that the general perceptions about Pakistan were worse than the reality and underscored the fact that Pakistan was one of the few countries in the world to be on track to achieve the first goal of eradicating extreme poverty and hunger. Referring to the stringent conditionalities imposed by the International Monetary Fund as a part of the


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structural adjustment programmes that can at time cause undue hardships on people, he suggested that the SRO-SSWA should work to promote an Asian Monetary Fund that would lend with a “human face” and noted that Pakistan would support such an initiative. He emphasized that inclusive growth was an issue that had to be pushed continuously in the context of the region.

24. H.E. Mr. Ibrahim Hussain Zaki, Special Envoy to the President of Maldives congratulated ESCAP for its historic decision to establish a new office in New Delhi and in his capacity as representative of the Maldives which is currently chairing the South Asian Association for Regional Cooperation (SAARC) stated that SAARC would closely interact with the SRO-SSWA towards the implementation of a range of activities. He stressed that his country’s current challenges were connectivity and climate change.

25. In her closing remarks, while thanking Professor Amartya Sen and other speakers at the lively debate on the development agenda for the subregion, Dr. Heyzer referred to ESCAP’s partnership with the Association of East Asian Nations (ASEAN) and expressed hope that a similar partnership could be developed with SAARC through the work of the SRO-SSWA. She also stressed the need to strengthen social protection systems, without which it is difficult to boost aggregate demand over the long run. She added that the need for work on development of a regional financial architecture was well established and the member States of ESCAP had indeed recently given a mandate to the ESCAP secretariat to explore key elements of a cooperative regional financial architecture.

C. Global Economic Turmoil and Economic Outlook of South and South-West Asia

26. The session was moderated by H.E. Mr. Daw Tenzin, Governor, Royal Monetary Authority of Bhutan who welcomed this discussion as being very timely in view of the economic turbulence that has gripped much of the world and is affecting many countries in the region, even though not all countries are impacted in the same manner. Mr. Tenzin also briefly discussed the issue of sovereign debts and challenges brought about by high levels of inflation. He then invited the two key speakers of the session, namely Professor Kaushik Basu and Dr. Atiur Rahman to make their presentations.

27. Professor Kaushik Basu, Chief Economic Adviser, Ministry of Finance, Government of India briefly described the global economic outlook, making special reference to the turbulent economic environment experienced by countries in the West. The current climate of economic uncertainty, with European Union and the United States of America at its centre, is of concern to all countries in the region, in particular emerging economies. In addition to the economic stagnation, developed countries such as Japan and the United States are faced with high inflation, persistent long-term unemployment, and productivity losses to different degrees. The issue of unemployment is not necessarily an immediate concern, as generating jobs and employment opportunities are long-term goals, challenging especially in times of recession. A lot of liquidity was injected into the global money supply to prevent recession from persisting and was finding its way to the emerging


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markets in the form of short-term capital flows bringing volatility. The Eurozone countries face serious problems with the worsening of the debt crisis that resulted from some member countries such as Greece, Italy and Spain, over-borrowing. Solutions to the crisis will be dependent on reaching a gentlemen’s agreement between powerful economies such as France and Germany and crisis affected countries.

28. The crisis is affecting the vulnerable segments of many economies. However, in spite of the crisis, economies in South Asia have grown relatively faster than those in other regions of the world. Prof. Basu made a comparative analysis of the performance of South Asian economies in term of growth and achievement of MDGs. He highlighted that while India’s overall growth had been very high, Sri Lanka had performed well with regards to parameters of human development. Some states of India such as Kerala had also performed like Sri Lanka in those respects. Bangladesh and Nepal have also performed well on many accounts. This demonstrates that it is possible to reach better human development outcomes even with lower per capita incomes and growth rates.

29. In conclusion, Prof. Basu underscored the importance of greater cooperation among countries in South Asia, including for the purpose of tackling global challenges. For example, Nepal had not effectively utilized its huge potential in terms of power-generation through electricity, something which is in short supply in India and is direly needed to boost production unlike Bhutan. Similarly, further enhancing trade relations among South Asian countries could play a key role in accelerating economic growth. With enhanced trade facilitation and more effective use of dry ports to connect the region, a significantly higher level of trade could be generated.

30. H.E. Dr. Atiur Rahman, Governor, Bangladesh Bank noted that the global economy, which had just emerged from the slowdown triggered by the 2008-2009 crisis, was now facing fresh threat owing to the ongoing European debt crisis linked to unsustainable debt levels in the public sector. The demand weaknesses in these developed economies are already affecting export-led output growth in the developing economies selling to these markets, and investment outflows from developed economies will also remain depressed by the prolonged slowdown, further clouding the growth outlook for developing economies. Countries in the SSWA region would be well advised to preserve balance and stability in their own economies, limiting both public and private sector debts to sustainable levels. Besides safeguarding stability within the region, this would enable SSWA countries to raise forceful collective voice in global forums against external spillovers of loose internal policies of large economies creating global imbalance and instability. He stressed the need to strengthen the thrust for domestic demand-driven growth through appropriate income and supply-augmenting policies. This would entail a widening of public-funded social safety net coverage for the weak and vulnerable segments of the population, among other things. He also drew attention to massive investment needs of countries in the subregion to address crippling deficiencies in physical infrastructure. He argued that all countries in SSWA were in a position to set aside a portion of their foreign exchange reserves for investment specifically in high-quality financial assets related to infrastructure projects in the region.


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These investments in assets with somewhat different liquidity and risk-return profiles from conventional reserve assets could be handled through sovereign wealth funds at country level, or through a multilateral infrastructure fund at SSWA regional level. Dr. Rahman also stressed the potential of intra-regional trade in South and South West Asia to substantially compensate for the decline in trade with the advanced economies. He expects the new office to "assume a catalysing role in negotiating new win-win intraregional preferential trade and tariff arrangements between the SSWA countries", thereby also echoing Prof. Kaushik Basu’s emphasis on the need for strengthened regional economic integration.

D. MDGs, Poverty Reduction and Inclusive Development: Development Agenda for 2015 and Beyond

31. The session was moderated by Professor Rahman Sobhan, Chairman, Centre for Policy Dialogue, Dhaka. Looking at the post-MDG era, Prof. Sobhan underscored the vital importance of inclusive development, to ensure the underprivileged could enjoy the benefits of development and fully participate in economic growth, on par with wealthier sections of the society. He drew attention of participants to the means of addressing the sources of poverty, through the process of empowerment, access to key assets and the bridging of disparities in access to quality education and health care. He stressed the need for democracies to become even more democratic. Prof. Sobhan then opened the floor to the two presenters Dr. Hafiz Pasha and Professor Bina Agarwal.

32. Dr. Hafiz Pasha, Dean, School of Social Science, Beaconhouse National University, Lahore, Pakistan and former Finance Minister and Assistant Secretary-General, United Nations began his presentation by raising a few questions and reflected on the extent of inclusive growth in South Asia. Although the rate of economic growth in the region has been relatively high, he noted that the process had not been inclusive enough, especially in terms of benefiting lower income groups. He stressed that the global environment had generally not been supportive of attaining the MDGs and cited some reasons for an absence of a trickledown effect: the relative poor performance of agriculture, especially food production; the low employment response to output growth; the low and slow improvement in levels of human development; and the spurt of inflation, especially in food prices over the past few years. Indeed, he observed that most South Asian countries had fallen sharply in Human Development Index (HDI) rankings in 2011 and that overall, South Asia’s HDI ranking was the lowest among all subregions of the world, with the exception of Sub-Saharan Africa. He noted that while most South Asian countries had public expenditure on education of 3.5 to 4 per cent of GDP, expenditure on health was very low at about 1 per cent of GDP only. In addition, macroeconomic imbalances had been rising, including the fiscal deficits, which exceed 8 per cent of GDP in some countries, also limiting the fiscal space for the expansion of social protection programmes.

33. Dr. Pasha brought to the attention of participants the value of the MDGs, as an embodiment of the principles of the United Nations Charter, providing a framework for international cooperation, while also promoting the involvement of civil society organizations


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and the private sector. He underscored the fact that the MDGs compelled Governments to invest in its citizens and be more accountable for their performance. Turning towards lessons learnt from the process of implementing the MDGs, which may be incorporated in the development agenda beyond 2015, he argued that focusing on fewer more critical targets, with a primary focus on the elimination of poverty and hunger, and paying greater attention to the reduction of inequality, the identification of emerging risks, and the promotion of democratic governance, with a special emphasis on LDCs, conflict-affected and fragile countries, may be useful. Among other things, he suggested that a stronger focus be placed on health-related interventions. He concluded his presentation by exploring future processes for the MDGs, suggesting that national stakeholders ought to take greater ownership of the MDGs, which are not to be misunderstood as being externally imposed but could be achieved more effectively through enhanced south-south cooperation and with stronger linkages of regional trade and investment, as well as the strengthening of regional financial institutions. He welcomed in that context the recent decision by the Government of Pakistan to grant the Most Favoured Nation (MFN) status to India.

34. Prof. Bina Agarwal, Director, Institute of Economic Growth, New Delhi, began her presentation by reflecting on the evolution of the concept of development over the past decades and new aspirations which came about in the 1950s-1960s in the wake of various movements for independence across the world. She discussed the dimensions of well-being, as per the conclusion of the Report of the Commission on the Measurement of Economic Performance and Social Progress, also known as the “Sarkozy-Stiglitz Commission” (chaired by Prof. Joseph Stiglitz, with Prof. Amartya Sen as Chair Adviser and Prof. Fitoussi as Coordinator), based on the following components viz., material living standards (income, consumption, wealth), health, education, personal activities, including work, political voice and governance, social connections and relationships, environment (present and future conditions), and insecurity, economic and physical nature.

35. Prof. Agarwal underscored the need to revisit/rethink the development agenda, possibly broadening it to encompass the many dimensions that shape people’s wellbeing, and to bridge existing gaps. She cited for example the issue of gender gaps and domestic violence, which is pervasive as up to 50 per cent of women in some areas report having experienced violence in their lifetime, as well as the issue of national averages, which can mask gaping inequalities. Acknowledging the dearth of data that can impede the process, she argued that MDGs should be driven by a clearer conceptual approach, broader participation, cooperation and vision, values and ethics.

E. Rising Food Prices and Food Security: Policy Options for South and South-West Asia

36. Dr. Ashok Gulati, Chairman, Commission for Agricultural Costs and Prices, Government of India, who moderated the session, explained that commodity prices had recently shown an upward trend and that was severely affecting poor people. In this context, policy decisions were often knee-jerk reactions though urgent attention ought to be accorded


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not only to consumers’ concerns over higher prices but also to farmers’ grievances over the low prices that they receive at the farm gate. He stressed the importance of striking an appropriate balance between the two. He then invited the two speakers for the session, namely Dr. Mahendra Dev and Dr. Mohan Man Sainju to make their presentations.

37. Dr. Mahendra Dev, Director, Indira Gandhi Institute for Development Research, Mumbai, while providing an overview of the current trends in food prices in South Asia, attributed the recent escalation of food prices to both structural and cyclical factors at both domestic and global levels, which include neglect of investment in agriculture, population growth, high growth in emerging economies, recurring natural disasters, export restrictions, conversion of food into bio-fuels, and increased speculation in commodity markets. The impact of the high food prices on the macro economy, poverty (with millions of people affected) and food security were also discussed.

38. Policy options to address global food inflation include increasing supply of agricultural commodities through increased productivity, focusing on small farmers to address the many constraints small holders face, and strengthening social protection policies. Dr. Dev highlighted the many opportunities for change that the situation brings about and cited the innovations that need to be sustained, including efforts by women’s collectives and farmers to reap the benefits of the mobile phone revolution.

39. The need for cooperation at both regional and global levels was emphasized to bring forth long-term sustainable solutions to the issue of food security. These include among other things, the SAARC Food Bank, joint agricultural research programmes for increasing productivity, cooperation in new sciences, free exchange of technology and information on good practices in the field, improved animal breeding and disease management technologies.

40. With regards to global cooperation, Dr. Dev recalled the recent G20 initiative calling for action in five key areas, including improving agricultural production and productivity, increasing market information and transparency, strengthening international policy coordination, improving risk management tools, and smoother functioning of agricultural commodity derivative markets. He concluded that a long-term solution was to increase agricultural productivity and farmers’ income, as well as ensuring rural non-farm sector development and strengthening social protection measures.

41. Dr. Mohan Man Sainju, Chairman, Institute of Integrated Development Studies and former Vice Chairman of the Planning Commission of Nepal, noted that rising food prices is an issue of serious concern for poor people in South and South-West Asia. He stressed that food security and poverty were closely interrelated. For example, he pointed out that even though some countries like India were categorized as food surplus countries, a large portion of its poor population had no access to food and to basic necessities of life. He urged special attention to be accorded to mountainous countries along the Hindu Kush-Himalayan range region and called for a comprehensive approach to address the issue of food security, noting that increasing agricultural production was a necessary but not sufficient condition.


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Governance-related issues such as those related to tackling rising income inequality, women’s empowerment and education on food and nutrition are also important.

42. He expected that the SRO-SSWA would serve as a platform/forum for sharing knowledge, experiences and good practices, which could be emulated. The Office could also assist in regularly monitoring the situation in relation to food security, acting as an action trigger to help prevent food price rises, and supporting capacity-building efforts of least developed.

43. In follow-up discussions, the potential of microfinance to increase domestic food production, such as in the case of Bangladesh, was highlighted. In his concluding remarks, the session chair Dr. Ashok Gulati summarized the discussion highlighting four critical aspects of food security that needed to be addressed: availability of and economic access to food, especially in hunger pockets and in the absence of social safety nets; lack of nutrition, especially for women, in spite of access to food; stability of food prices through buffer-stocking; and the difficulty of assessing the optimum level of buffer-stocks.

F. Regional Economic Cooperation and Connectivity in the Subregion: Potential and Challenges

44. This session was moderated by H.E. Mr. Ibrahim Hussain Zaki, Special Envoy to the President of Maldives, who brought to the attention of participants the fact that the Maldives had hosted this year’s SAARC summit and that the themes of connectivity and building trade linkages had been given high prominence in the Summit outcome document. He stressed that there was a growing political consensus to build upon in the area of enhancing regional economic integration and connectivity.

45. H.E. Mr. M. Yahya Maroofi, Secretary-General, Economic Cooperation Organization (ECO) stated that the region served by his organization encompassed 430 million people and a land area of 8 million sq.km, providing a bridge between East and West. Economic integration and connectivity were therefore important issues not only for ECO members but for the subregion as a whole. While sharing lessons learnt from projects implemented particularly in the area of infrastructure development, he underscored that regionalization and enhanced intraregional competition would bring about a number of benefits such as greater specialization and realization of economies of scale, wider range of commodities and increased competitiveness of good and services. Mr. Maroofi emphasized that regional economic cooperation and connectivity were closely interrelated. With trade and transportation being at the core of meaningful and sustainable regional economic cooperation and connectivity, ECO had made these issues top priority in their plans and projects, even though intra-regional trade still left much to be desired. He noted that his organization was currently focusing on laying down the necessary regulatory framework for investment opportunities and for reducing trade barriers to encourage expansion of intra and interregional trade and investment, and had implemented a number of significant programmes and projects in the area of transport, for example through the ECO Broad Plan on Connectivity and the ECO Container train (Islamabad – Tehran – Istanbul) among other initiatives. The ECO


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Broad Plan on Connectivity consists of a three-pronged strategy: infrastructure development, harmonization of transit rules and regulations, and institutional capacity-building with member States to ensure better integration among international and regional bodies.

46. Dr. Saman Kelegama, Executive Director, Institute for Policy Studies of Sri Lanka, Colombo, provided an overview of existing mechanisms and arrangements for regional cooperation among SAARC countries, highlighting the fact that more could be done to reap the full potential of enhanced regional cooperation in South and South-West Asia. For example, the share of intra-regional trade is relatively low, at 38 per cent compared with an average of 51.5 for the entire Asian and Pacific region. Similarly, the share of trade in final goods within South Asia amounts to 2.8 per cent only as against 43.4 for East Asia. Furthermore, Dr. Kelegama noted that the subregion -- especially South Asia – was the least integrated in the world and had been slow to respond to the global trend of regionalism, although it offered complementarity with other subregions. He stressed the importance of boosting domestic and regional demand especially for small countries and LDCs, particularly in the light of the global financial and debt crisis. These objectives can only be achieved, along various measures in the area of trade liberalization and facilitation, transport, finance, energy and ICT networks, some of which remain as serious challenges. He hoped that the SRO-SSWA would promote regional economic integration of the subregion by coordinating with different stake holders, with policy dialogues and advocacy with the governments.

47. Mr. TCA Srinivasa Raghavan, Senior Fellow, Asian Institute of Transport Development and Mr. K.L. Thapar, Chairman, AITD highlighted the paradox of the so-called connected world we are living in, though road and railway links still leave much to be desired. He noted that South Asia in particular was in an especially disadvantaged position, for example with very slow processes for containers to transit between Delhi and Dhaka. He called for a more holistic approach and for the integration and harmonization of technological platforms.

48. Mr. Naeem Anwar, Minister (Trade), High Commission of Pakistan, New Delhi, acknowledged that the potential of regional economic integration remained unexploited in South Asia. Very often bilateral issues were blocking progress. He pointed out the visa regimes between South Asian countries need to be eased to facilitate people-to-people contacts. He referred to the recent developments in the Indo-Pakistan trade context with Pakistan moving from positive list basis to negative list basis in bilateral trade. This would help promote bilateral trade.

G. Sustainable Development and Rio+20 Agenda: A Subregional Perspective

49. The session was moderated by H.E. Mr. Ibrahim H. Zaki, Special Envoy to the President of Maldives, who underscored the importance of sustainable and inclusive development for countries in the subregion and invited Dr. Prodipto Ghosh, Distinguished Fellow, The Energy and Resources Institute (TERI), New Delhi to make a presentation. Dr Ghosh made a comprehensive presentation summarizing the situation in India, Pakistan, Bangladesh, Islamic Republic of Iran and Turkey. India’s National Environmental Policy


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(NEP), 2006 defines sustainable development as that ‘which respects ecological constraints and the imperatives of social justice.’ NEP also makes it clear that the most viable basis of environmental conservation is to ensure that people gain better livelihoods from the act of conserving natural resources than from that of degrading the environment. Environmental degradation tends to perpetuate poverty, in particular when such degradation impacts soil fertility, quantity and quality of water, air quality, forests, wildlife and fisheries. It can naturally lead to issues such as malnutrition, lack of access to clean energy and water, etc. Environmental factors are estimated to be responsible for nearly 20 per cent of the burden of disease in India. While the country has made considerable progress on the path of sustainable development through taking adequate legislative measures, challenges remain particularly with regards to implementation. India has a mixed track record in the pursuit of the Millennium Development Goals (MDGs). However, India has achieved considerable progress in the implementation of the Clean Development Mechanism and has one of the best track records in terms of volume of CDM projects implemented.

50. Pakistan is facing several challenges that affect its sustainable development paradigm. The impact of climate change has been visible in almost all sectors of the economy. The Government of Pakistan is yet to comprehensively address issues of conservation through legislation. Furthermore, issues related to governance, technical capacity as well as cooperation (both at the regional and global levels) tend to impede further progress towards sustainable development. However, there are many positive developments, including among other things, the widespread usage of cleaner fuels such as Compressed Natural Gas (CNG).

51. Bangladesh has achieved considerable progress in the eradication of poverty when compared with other countries in the subregion. The per capita intensity of Green House Gas (GHG) emissions is also very modest. However, Bangladesh is facing important challenges owing to the repeated incidence of natural disasters. Almost one fifth of the country is flooded every year and many parts of the country are devastated by storms on a regular basis. Based on an estimate of eight sustainability indicators, Bangladesh has been assessed as having achieved considerable progress in pursuing the path of sustainable development since the baseline year of 1990.

52. The economy of the Islamic Republic of Iran has been extremely dependant on petroleum and natural gas sectors. The energy consumption in the country has been increasing along with economic growth, which is high. Air pollution has been a major environmental issue, estimated to affect over 18 per cent of the population in Tehran. Based on assessment of various sustainability indicators, Iran’s performance has been well on track, except with regard to carbon dioxide emissions and energy efficiency.

53. Turkey has made significant progress on the front of sustainable development that has been the strategic goal of Environment Law No. 2872. The law also outlines a clear framework for achieving sustainable development in the country through adequate legislations and enforcement. The National Sustainable Development Authority and the


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National Commission for Sustainable Development are the key nodal agencies that constitute the governance framework for sustainable development. Turkey’s Ninth Development Plan (2007-2013) is currently being implemented. The impact of the plan however can still not be assessed at this point in time.

54. Mr. Omar Azizullah, Deputy Director General of Economic Affairs, Afghanistan began his presentation by complementing ESCAP for opening the new Office that, in his view, would greatly benefit countries in the subregion through enhanced cooperation. He argued that while there were positive signs on the security front, Afghanistan’s GDP growth was reported to stand at about 21 per cent in 2007 against 8 per cent in 2010. The GDP per capita of the country increased more than doubled during the last five years. Over the past 10 years, the Government has invested over USD6 billion in the sectors of telecommunication, airlines, banks and media, and also focused on different areas of ICT with over 50 per cent of the Afghan population now using mobile phones (over 16 million users). However, still about 36 per cent of the population of Afghanistan live below the poverty line. In addition, the security situation of the country poses a serious threat to stability and further economic growth, while not enough has been done to ensure food security throughout the country. Recognizing the importance of agriculture, the Government has made it a priority sector. It also wanted to make better use of the country’s mineral reserves as well as its strategic geographic location. Afghanistan is well positioned indeed to play a lead role in the transit of energy resources (natural gas) from Turkmenistan to Pakistan and India, a positioning that would also generate significant revenue for the country.

55. Additional points were made in the discussion following the presentations. Dr. Atiur Rahman noted that sustainable development was being actively pursued in Bangladesh and pointed out that numerous government agencies and civil society organizations were involved at grass-roots level projects to eradicate poverty and enhance the livelihoods. The Government had made it mandatory to incorporate a sustainable development agenda in the day-to-day governance of national institutions. For instance, green banking guidelines aim to ensure that banks make lesser use of paper in their transactions to reduce their overall carbon footprint. Besides, the Bangladesh Bank had allocated Taka 2 billion to support projects in the areas of solar, biogas and water treatment and was promoting solar power run ATMs across the country. Dr. Ibrahim Zaki noted that the Maldives had been proactive in incorporating environmental concerns into its development paradigm. He mentioned that the Maldives was aspiring to become carbon neutral by 2020 and was very focused on achieving this objective.

56. The session concluded that while all countries in the subregion were making efforts to pursue economic development while minimizing environmental impact, they had a long way to go to achieve their respective targets for overall positive economic growth with minimal environmental damage. There were also substantial opportunities of learning from each other and replicating from best practices, for instance, from India and Bangladesh in promoting solar power applications.


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H. Partnerships for Development of Countries with Special Needs: Implementing the Istanbul Programme of Action and Almaty Programme of Action in South Asia

57. H.E. Dr. Sham L. Bathija, Senior Adviser-Minister for Economic Affairs to the President of Afghanistan moderated the session and argued that least developed countries (LDCs) and Land Locked Developing Countries (LLDCs) need to pursue a multi-dimensional approach to development, pursuing strategies for inclusive economic growth keeping in mind the many constraints they faced.

58. Dr. Nagesh Kumar, in his introductory remarks, emphasized that partnership was crucial for the development of LDCs. He noted that in view of the fact that four of the 10 countries in the subregion were LDCs (Afghanistan, Nepal, Bhutan and Bangladesh) and three of them were also LLDCs, the work programme of the SRO-SSWA will pay a special attention to their developmental challenges.

59. H.E Mr. Gauri Pradhan, Member, National Human Rights Commission, Nepal then made a presentation, noting that LDCs were highly vulnerable to external shocks and imbalances and hence needed alternative strategies and new development pathways to be successful. He mentioned that over the years, the number of LDCs had increased from 24 to 48, indicating that the development paradigm had had lesser impact on the quality of life. He noted that only the Maldives had shown considerable progress and had graduated from the LDC status, while many other countries were still struggling on the path of development. He observed that LDC countries displayed among the lowest per capita incomes in the world but the highest population growth. He called for a regional strategy to be developed to enhance partnership in the field of population and demography among countries in the subregion among other areas. He further emphasized that it was not possible for the global community to achieve MDGs without the active involvement of LDCs. He pointed out that both North-South and South-South partnerships were needed to fully implement the Istanbul Programme of Action and Almaty Programme of Action in the subregion.

60. Mr. Davood Manzour, Deputy Head of Planning Office, Presidential Office, Islamic Republic of Iran made a presentation and emphasized that countries in the subregion had done well in terms of tax reforms, flexibility in exchange rates, reversing protective trade policies, among other things. He noted that economies in Asia-Pacific continued to grow in spite of the global economic downturn, which is an indication that the subregion enjoys considerable independence from the world economy and that the spillover effects of the global slowdown were felt less in the subregion than in Europe and North America. In his view, the major development challenges facing South and South-West Asian countries included job creation and employment, capital formation, food security, income distribution, health-care, infrastructure development, sustainable energy supply, human rights and gender equality concerns. He stressed that the economy of the Islamic Republic of Iran had registered 3.5 per cent growth in 2009-10 as compared with 0.6 per cent growth in 2008. This was possible owing largely to exceptional developments in the agricultural sector. Iran plans to increase its gas production from 550 mcm/d to 1452 mcm/d by 2017 and also to


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reduce unemployment from the current 11 per cent to 7 per cent by 2015. The Government plans to increase non-oil exports to USD 110 billion and also to invest heavily in oil and gas sectors. Further, the Government plans to increase health insurance coverage and decrease citizens’ out-of-pocket expenditure on health services. The country hopes to be in a position to further contribute to the economic growth of the entire sub-region through its cooperation with SAARC as well as by promoting ties with the Shanghai Cooperation Organization (SCO). As a connecting hub, the Islamic Republic of Iran plays a crucial role in facilitating trade through the North-South corridor and by transmitting gas to countries in South Asia. Iran also positions itself as a major connecting link between South and Central Asia as well as between South Asia and Europe.

61. Mr. Arvind Mehta, Joint Secretary, Ministry of Commerce and Industry, Government of India in his presentation emphasized that India had significantly contributed to LDC members of SAARC, for example by unilaterally removing duty for all imports (except liquor and tobacco products) from LDC members of SAARC. In addition, India has provided duty-free access to Nepal in bilateral trade. He expressed concern that many countries in the subregion were not able to take full advantage of the preferential treatment blaming non-tariff barriers. However, the real reason lies possibly in terms of low productive capacity in the areas of import interest of the partner countries that does not allow them to take advantage of offers of preferential market access. The supply capability needs to be augmented by industrial policy, openness to FDI, availability of facilitating infrastructure, rule of law, etc. He cited the example of Nepal whose potential for hydropower had been estimated at around 40,000 – 80,000 MW of which barely 1 per cent of its potential has been tapped. The country had huge potential of expanding its hydro power generating capacity and sell power to neighboring countries such as India that could help it earn revenues in the range of USD10 billion per year. However, this required huge investments (approx. USD2 million per MW). He also stressed that such opportunities do not present themselves forever as other nonconventional alternatives such as solar and wind energy sectors were quickly becoming viable. He emphasized that proactive policies should be formulated and implemented in these countries, and exploit the windows of opportunities for countries in the subregion to invest and gain from mutually beneficial projects. He pointed out that SAARC Development Fund with a total funding of 100 Million USD may be inadequate to address the infrastructure needs of the countries in the subregion and that the region needed a more ambitious regional development bank to cater to its deep capital requirements. Besides unilateral trade preferences in favour of LDCs, India had also provided credit lines to Bangladesh, Sri Lanka and Bhutan. The Indian Government has also implemented a USD 100 Million Buyer’s Credit Programme through the Exim Bank to facilitate trade with other countries in the region.

I. Closing Session

62. In her valedictory remarks, Dr. Noeleen Heyzer, Under-Secretary General of the United Nations and Executive Secretary of ESCAP recalled the words of Prof. Amartya Sen and his recommendation that the reshaped global economic governance should take into


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account the specific concerns of LDCs, while aggregate demand in countries of the subregion should be enhanced to strengthen the subregion’s resilience. Furthermore, the due emphasis in the development process to income security, social protection, gender equality, expanding the democratic space and economic connectivity are critical for ensuring inclusive economic growth and sustainable development in South and South-West Asia. She stated that ESCAP would strive to help countries in the region meet their development challenges and achieve the MDGs. She emphasized that one of the top priorities for the Subregional Office would be to help build the productive capacities of member States within the subregion.

63. Mr. Patrice Coeur-Bizot, United Nations Resident Coordinator and UNDP Resident Representative in his remarks assured ESCAP and member States represented that the UN Country Team (UNCT) under his leadership would offer every possible support to the SRO-SSWA in implementing its work programme.

64. In his closing remarks, Dr. Nagesh Kumar, thanked the Executive Secretary, Professor Amartya Sen, senior policymakers from South and South-West Asia as well as the UN Resident Coordinator, members of the UNCT and all distinguished guests for the strong support they extended to the new Office. He assured them that he and his team would strive to meet the developmental aspirations of members States from the South and South-West Asian subregion.


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ANNEX

PROGRAMME

Opening of the

ESCAP Sub-regional Office for South and South-West Asia and the

High-level Policy Dialogue on Development Challenges facing the Subregion

Taj Mahal Hotel, New Delhi, 15-16 December 2011 ……………………………………….

Thursday, 15 December 2011 0900-0930 Arrival of Guests and Registration Venue: Diwan-i-Am 0945-1100 Inaugural Session

Welcome remarks: Dr Nagesh Kumar, Director, ESCAP-SSWA Opening Address: Dr Noeleen Heyzer, Under-Secretary General of United Nations and Executive Secretary of ESCAP Keynote Address: Prof. Amartya Sen, Nobel Laureate, T.W. Lamont University Professor, Harvard University Chairperson’s remarks: H.E. Dr Sarath Amunugama, Senior Minister of International Monetary Cooperation, Sri Lanka and Chairperson, ESCAP’s 67th Session

1100-1130 Tea Break 1130-1300 Interactive Dialogue of Ministers and Policy Makers from member

countries Moderator: Dr Noeleen Heyzer, Under-Secretary General of the United Nations and Executive Secretary of ESCAP Introductory remarks: Professor Amartya Sen Panelists: H.E. Dr Sham L. Bathija, Senior Adviser-Minister for Economic Affairs to the President of Afghanistan H.E. Professor Rahman Sobhan, Chairman, Centre for Policy Dialogue, Dhaka, former Member of the Planning Commission. H.E. Mr Ibrahim Hussain Zaki, Special Envoy to the President of Maldives H.E. Dr Hafiz Pasha, Convener, Prime Minister's Economic Advisory Council, Government of Pakistan and former Finance Minister H.E. Dr Sarath Amunugama, Senior Minister of International Monetary Cooperation, Government of Sri Lanka Open Discussion

1300-1400 Lunch


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1400-1530 Global economic turmoil and economic outlook of South and South- West Asia Moderator: H.E. Mr Daw Tenzin, Governor, Royal Monetary Authority of Bhutan Lead Presentations: Professor Kaushik Basu, Chief Economic Adviser, Ministry of Finance, Government of India H.E. Dr Atiur Rahman, Governor, Bangladesh Bank Open discussion

1530-1545 Tea break 1545-1700 MDGs, poverty reduction and inclusive development: Development

Agenda for 2015 and beyond Moderator: Professor Rahman Sobhan, Chairman, Centre for Policy Dialogue, Dhaka Lead Presentations: Dr Hafiz Pasha, Convener, Prime Minister's Economic Advisory Council, Government of Pakistan and former Finance Minister, Dean, School of Social Science, Beaconhouse National University, Lahore, Pakistan Prof Bina Agarwal, Director, Institute of Economic Growth, Delhi Open discussion

1930 Reception/dinner hosted by Dr Noeleen Heyzer, Under-Secretary General of the United Nations and Executive Secretary of ESCAP at the ESCAP SRO-SSWA, C-2 Qutab Institutional Area, New Delhi-110016

Friday, 16 December 2011 0945-1100

Venue : Long Champ, Hotel Taj Mahal Rising food prices and food security: Policy options for South and South West Asian Countries Moderator: Dr Ashok Gulati, Chairman, Commission for Agricultural Costs and Prices, Government of India Lead Presentations: Dr S. Mahendra Dev, Director (Vice Chancellor), Indira Gandhi Institute for Development Research, Mumbai Dr Mohan Man Sainju, Chairman, Institute of Integrated Development Studies, Kathmandu and former Vice Chairman, Planning Commission of Nepal Open discussion

1100-1130

Tea break

1130-1300 Regional economic cooperation and connectivity in the Sub-region:

Potential and challenges Moderator: H.E. Mr Ibrahim Hussain Zaki, Special Envoy to the President of Maldives Presentations H.E. Mr M. Yahya Maroofi, Secretary-General, Economic Cooperation


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Organization Secretariat (ECO), Tehran: Dr Saman Kelegama, Executive Director, Institute for Policy Studies of Sri Lanka, Colombo Mr TCA Srinivasa Raghavan, Senior Fellow, Asian Institute of Transport Development (AITD), and Mr K.L Thapar, Chairman, AITD, New Delhi Mr Naeem Anwar, Minister (Trade), High Commission of Pakistan, New Delhi Open discussion

1300-1400 Lunch 1400-1515 Sustainable development and Rio+20 Agenda: A subregional

perspective Moderator: H.E. Mr Ibrahim Hussain Zaki, Special Envoy to the President of Maldives Lead Presentations: Dr Prodipto Ghosh, Distinguished Fellow, The Energy and Resources Institute (TERI), New Delhi and Member of the prime Minister’s Council on Climate Change and former Secretary, Ministry of Environment and Forest, Government of India Mr Omer Azizullah, Deputy Director General of Economic Affairs, Ministry of Foreign Affairs, Afghanistan Open discussion

1515-1530 Tea break 1530-1645 Partnerships for development of Countries with Special Needs:

Implementing the Istanbul Programme of Action and Almaty Programme of Action in South Asia Moderator: H.E. Dr Sham L. Bathija, Senior Adviser-Minister for Economic Affairs to the President of Afghanistan Presentations: H.E. Mr Gauri Pradhan, Member, National Human Rights Commission, Nepal Mr Davood Manzour, Deputy Head of Planning Office, Presidential Office, Islamic Republic of Iran, Tehran Mr Arvind Mehta, Joint Secretary, Ministry of Commerce and Industry, Government of India

1645-1730 Concluding session Chair: Dr Noeleen Heyzer, Under Secretary General of the United Nations and Executive Secretary of ESCAP Remarks: Mr. Patrice Coeur-Bizot, UN Resident Coordinator & UNDP Resident Representative, New Delhi Vote of Thanks: Dr Nagesh Kumar, Director, ESCAP-SSWA

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