EXCLUSIVE | Govt refocuses on SAARC to counter China; Secretary General in Delhi for week-long talks

While the SAARC comprises 3 percent of the world's area, 24 percent of the world's population and 4.21 percent ($3.67 trillion) of the global economy, as of 2019, the tense historical divisions in the region have held it back.

Countering China

However, the latest push has been caused by reasons which are not too old, say sources. As part of the centenary celebrations of the Chinese Communist Party, China recently established the China-South Asian Countries Poverty Alleviation and Cooperative Development Center. Ambassadors from Pakistan, Bangladesh, Afghanistan, Nepal and Sri Lanka were present at the launch.

"The move is yet another way Beijing is trying to circle against India with the usual diplomatic tactics. The platform talks of poverty alleviation in South Asia and Beijing is expected to suggest more Chinese investments in the form of loans. India meanwhile has always supported inclusive, sustainable development," a senior official said.

Foreign policy experts welcomed the move. "The SAARC Secretary general visiting India for a week would mean that he will also be seeing officials other than those at the Ministry of External Affairs (MEA), which is a good sign. He has to understand what the plans are of the line ministries of the largest member state," Rajiv Bhatia, former ambassador and currently a Distinguished Fellow, Foreign Policy Studies Programme at Gateway House said.

Bhatia, a former Director General of the Indian Council of World Affairs (ICWA) however cautioned that things have always moved slow on SAARC.

"Clearly, the Indian subcontinent needs more and not less regional cooperation and integration. But the politics comes in the way, in India and the neighboring countries. On top of that, there are the external factors such as China. Things have always moved slow. Last March, India had tried to put more life into it, on the grounds of creating pandemic related cooperation. But that initiative also ran only upto a point," he added.

At a public policy level, the body has been effectively defunct since 2016 when the 19th SAARC Summit, set to be held in Islamabad, was cancelled. Led by India, six of the eight-member nations had pulled out in the aftermath of the Uri terrorist attacks.

However, the permanent SAARC secretariat based in Kathmandu along with SAARC's specialized bodies and regional centres, sprinkled across the capitals of the members nations, have continued to carry on with their assigned duties.  Among these, the Thimpu-based SAARC Development Fund (SDF) has seen the best performance, the government feels.

Development Fund

There is a considerable push to realign support towards the SDF given the recent successes of the fund, sources at secretariat said. The multilateral development financing body was set up by SAARC member nations back in 2005 as a multilateral umbrella financing institution for development projects in the region.

However, after being a non-starter for a long time with limited number of social projects, the body has since 2018 aimed to ramp up financing for infra projects. The body has more than 75 approved projects in the pipeline as of now, sources said.

"India provides bilateral assistance to other nations and especially in the neighborhood. We have a large number of independent projects running across all SAARC countries. There is a sense that some streamlining may be needed and the SDF can be used for that," the official said.

However, social development projects would continue to be a major part of its objectives. The SDF is also behind the Social Enterprise Development Program (SEDP). To work in all the member states with the objective of identifying and building social enterprises by using a mix of grants and concessional returnable capital. The program intends to fund around 80 enterprises across the 8 nations annually.

In the latest instance, it is also implementing a $7.7 million COVID grant for member states.