The Global Gateway Conference has recently been held in Meghalaya, India. The two-day gathering aimed to increase trade and economic development in the region by integrating the north-east of India with its neighbours Bhutan, Bangladesh, and Nepal.

According to the Ministry of External Affairs, the conference sought to “explore possibilities for boosting connectivity investments in India’s north-eastern states and with India’s neighbors.” The connectivity initiative seeks to find projects for combined implementation and is supported by three pillars: increasing digital, energy, and transportation links.

The Bangladesh-Bhutan-India-Nepal (BBIN) project is being used to address connectivity difficulties in South Asia to create a seamless flow of people and cargo traffic. For India, the two-day meeting sparked action on these challenges. Regional economic integration and improved people-to-people interactions, which have remained tethered to conflicts among the South Asian Association for Regional Cooperation (SAARC) nations, are anticipated to improve the relations between these countries.

The recent conference was also a platform for investment opportunities in the fields of clean and renewable energies, health and education, and transportation connectivity, which includes roads, bridges, and railroads. Participants from the commercial sector as well as ambassadors from the three South Asian countries attended the conference.

Progressing BBIN economic exchanges

The demand for regional economic cooperation and integration among South Asian nations, particularly the Bangladesh, Bhutan, India, and Nepal (BBIN) area, is developing as the world prepares to move beyond Covid-19. To date, South Asia is one of the least integrated areas in the world.

The BBIN Motor Vehicles Agreement (BBIN MVA) is a good example of the potential for regional economic development. Building a road-based corridor between the BBIN countries is the goal of the agreement and has been targeted for specific improvement by India. While the MVA has had a difficult start, SAARC was unable to agree on a regional motor vehicle accord at the Kathmandu Summit in 2014 due to opposition from Pakistan, it is considered too important to waste.

Although Bhutan has not ratified the deal, it has urged the other three countries to do so. The BBIN MVA seeks to facilitate the free flow of people, goods, and vehicles between and among the BBIN countries. South Asia has some of the lowest intraregional trade rates in the world, with barely five percent of the overall trade in the region. Notably, there are significant obstacles to overcome. Traders typically need to clear their paperwork by more than ten different authorities. Shipments are frequently weeks late due to a shortage of qualified laboratories to certify export products. The already significant trade costs among BBIN member countries are increased by the protracted border delays.

The transportation of goods and services is directly hampered by infrastructure gaps, crowded borders, long, detouring transport routes, and poor roads, which raise trade costs and transit times further. Along with these difficulties, it is important to think about building intermodal transshipment facilities, contemporary warehouse space, gender-inclusive infrastructure, and trade and transit-related workplaces.

In order to ensure a seamless flow of products and services, it is crucial to improve road and railway connectivity in India and Bangladesh with landlocked Nepal and Bhutan. Processes for commerce can be made more efficient by streamlining paperwork, improving risk management techniques to eliminate physical inspections, enabling cross-border transit, and modernising sanitary and phytosanitary regulations.

External partners, like the European Union, can help India, Bangladesh and Nepal create single electronic gateways so that importers and exporters may submit their paperwork electronically. These National Single Windows need substantial implementation support if they are to reduce clearing times.

Therefore, constructing and upgrading cross-border and internal highways, expanding multi-modal transport networks, including road and railroads, and modernising infrastructure and integrated border crossings all aid in solving key infrastructure gaps.

Additionally, South Asian nations should incorporate regional ideas like the border “haat” practiced at the India-Bangladesh and India-Myanmar border points. This would give small business owners and female traders greater access to the market.

High-quality road infrastructure should be prioritised, including improving the east-west roadway that links the three main land ports of Birgunj, Biratnagar, and Bhairahawa, for transportation connection.

The initial cost of high-quality road infrastructure may be high. However, the long-term benefits outweigh the initial costs. Numerous studies in high, middle, and low-income nations demonstrate a favourable correlation between transportation infrastructure and economic growth.

Since transportation is the main engine of economic growth, transportation infrastructure becomes crucial. If all stakeholders in the region can create leading road and rail infrastructure, the region will be able to access sizable external markets more.

Dr Ajanta Acharya is a senior researcher at South Asian Geopolitics at Savitribai Phule Pune University, Pune, India.

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