SAARC needs upgrading: Sinha

India has proposed creation of a South Asian Union (SAU), which will not only be an economic grouping but will also acquire a "political and strategic dimension".

"If Africa could think in terms of a union, if the Economic Community in Europe could become the European Union, if the ASEAN could make progress, if the countries in Latin America could make progress, there is no reason why we in South Asia cannot become a Union of South Asian states," Indian External Affairs Minister Yashwant Sinha said while inaugurating a seminar in New Delhi last evening.

Sinha made it clear that he was not suggesting an end to the South Asia Association of Regional Cooperation (SAARC) but its upgrading in view of changed economic and political realities across the world.

However, he made no bones about his displeasure with the progress of the SAARC. Over the last 17 years, the body has not been able to move ahead on its main objective of economic cooperation, he said.

Sinha also told the seminar, organised by the Dhaka-based Centre for Policy Dialogue (CPD), that India was ready for a free trade agreement with other SAARC countries.

With Bangladesh, there are 2,672 goods for which India has given preferential tariff and 484 items on which it gets such facility from Dhaka, Sinha said. "This is not good enough."

Out of over 7,000 tariff lines, New Delhi and Islamabad have given each other preferential tariffs, the external affairs minister pointed out.

There is no point in deliberating on the South Asian Preferential Trading Agreement (SAPTA) without making any progress, Sinha said. "India is ready to enter a free trade arrangement in the SAARC any time."

He also suggested free flow of investment and services along with a free trade for goods and merchandise within the SAARC.

There is a need to work carefully on the concept of value addition and India is ready to work out a reasonable level of such value addition, which will be the same in all SAARC countries, Sinha said.

Harmonisation of tariff was an essential component of a free-trade area but it cannot take place overnight and would take time, he said.

The external affairs minister urged the SAARC countries to think of the free-trade area in concrete terms. "What we need is a strong political will and I am trying to demonstrate this political will on behalf of the government of India."

A consultant has been appointed on free-trade arrangement among SAARC countries, he told the seminar. "People-to-people contact would grow once trade moved forward."

SAARC countries should stop suspecting each other's intentions all the time, Sinha said.

He said he came across a view that India wants to exploit Bangladesh by seeking its natural gas, which the country has in abundance.

He also dismissed "suspicions and apprehensions" of other SAARC countries about India as "unfounded".

"Its big size and population should not be held against India because there is nothing we can do about it," he said. "We have no other desire or intention than to be able to live in peace and friendship with our neighbours and join in the common task of improving the quality of life of our people."

SAARC countries are joined together by geography and "we can neither ignore each other nor afford to be friendly and cooperative".

SAARC member-countries should be sensitive to each other's security concerns, he pointed out.

New Delhi remains committed to the "Gujral doctrine" of friendly ties with its neighbours, the external affairs minister said. Former Indian prime minister Inder Kumar Gujral, who propounded the theory, was also on the dais with the external affairs minister.

"India remains committed to the Gujral doctrine," Sinha said. "We are ready to move further ahead in the direction of peace, friendship and prosperity to all our neighbours."

The famous "Gujral doctrine" was first heard in 1996 and India today remains committed to good neighbourly policy of Atal Behari Vajpayee.

It was left to Gujral to provide the finale to the seminar. "If we take this road (as proposed by Sinha), the mistakes of the past will automatically end. If you want to pick anything from the past, it is perhaps the mistakes that we have made and how we can avoid repeating them."