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The Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC) Free Trade Agreement (FTA) to enhance intra-regional trade among member nations, the Minister of State (MoS) for External Affairs, Pabitra Margherita said while speaking at the inaugural session of the BIMSTEC business summit.
Margherita added that the proposed FTA would catalyse economic growth and cooperation in the region. The minister highlighted the shared history and values among BIMSTEC countries, emphasising the need for greater collaboration to tackle global challenges.
“We are facing a world where unequal globalisation has concentrated technology and manufacturing, creating vulnerabilities in supply chains. It is imperative that we work together to create alternative pathways for growth,” he said.
He noted that the region's vulnerability to climate change, inflation and foreign exchange imbalances requires urgent action. “Our part of the world is acutely at risk from climate-related disruptions. It is crucial that we adopt sustainable practices to mitigate these risks.”
Margherita also stressed the importance of digital and physical connectivity to ensure regional growth.
Sanjeev Puri, President of the Confederation of Indian Industry (CII) emphasised BIMSTEC's potential as a global manufacturing hub and technology powerhouse. “BIMSTEC can drive digital transformation, infrastructure development and financial inclusion,” said Puri. “Our members are eager to engage with regional counterparts to explore trade and investment opportunities.”
Puri outlined key areas for collaboration like economic integration and trade facilitation; regional connectivity; energy security and green energy; climate adaptation and resilience; and food security.
The Bangladesh-India-Sri Lanka-Thailand economic Cooperation group was first established in June 1997 and in 2004, it was expanded to include Bhutan, Myanmar and Nepal to become the Bay of Bengal Initiative for Multi-sectoral Technical and Economic Cooperation (BIMSTEC).
The Confederation of Indian Industries (CII) has released a study on BIMSTEC Economic Cooperation with recommendations to improve economic cooperation among the member countries. The report recommended that BIMSTEC must together add more areas of cooperation to its ambit. It emphasised expanding skill development to leverage the young workforce, evolve methodologies for ecommerce cooperation, boost digital public infrastructure and digital access, and foster women-led development.
“All of these can be disseminated via best practices followed by member countries, such as women’s participation in economic development in Bangladesh, ecommerce in Thailand, and digital public infrastructure in Indi,” according to the report.
The GDP of BIMSTEC countries is currently about USD 4.5 trillion but the region can achieve faster future growth rates through better economic integration. However, with a total population of 1.7 billion, or 22 per cent of the world's population, BIMSTEC countries have the potential to contribute to the global economy and each other.
BIMSTEC's primary focus is economic and technical cooperation among the countries of South Asia and Southeast Asia that are geographically around the Bay of Bengal. The combined external trade of the BIMSTEC member states in 2022 amounted to USD 1.95 trillion. However, intra-regional trade is low and not commensurate with the diversified economies of the member states.
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