Saturday, September 11, 2010


There is a traditional mindset that cooperation is always between the developed world and developing world because of the fact that developed world is economically, politically, socially and technologically well-off which can be shared with the developing countries. But over the period it was realized the south-South Cooperation among the developing countries is necessary for better bargaining power with the developed world.

Southern hemisphere countries are developing nations which face the common challenges like poverty, unemployment ,hunger , disease, environment degradation. It can be jointly addressed through South-south Cooperation.

Many organisations like SAFTA, IBSA, NAM, G-77, 10C-RIM, Mercosur, Andean Community are formed to facilitate South-south Cooperation. South-south Cooperation has gained importance due to WTO negotiations and jointly addresses the problems created by globalization


SAFTA or South Asian Free Trade Area agreement was formulated on January 6th, 2004 at the 12th SAARC summit held in Pakistan

The agreement envisages the creation of a model of free trade zone in its seven member nations. The seven member nations consisting of approximately, 1.4 billion people, include the following countries:

· India

· Nepal

· Pakistan

· Bangladesh

· Bhutan

· Maldives

· Nepal

The SAFTA agreement was introduced with a view of levying zero customs duty for trading any product by the year 2012. The SAFTA agreement was implemented only after confirmation of compliance by the governments of the seven member nations. If the SAFTA agreement is religiously and judiciously followed, the agreement is likely to bring about economic stability in the member nations. The agreement may also facilitate healthy trade as well as investment relationship across borders thereby bringing about many structural reforms in the economy of the seven countries. However, there are certain obstacles, which hinder trade across South Asian countries as a result of, which trade across borders of the South Asian countries account for only 5% of the total trade. The reason can be attributed to two prominent factors. They are political reasons and too much protectionism.

Political causes: During the late 1940s, majority of the South Asian nations were part of British India, which was a common political entity. During that period, there was considerable amount of trade between the different South Asian countries. However, in the year 1947, when India and Pakistan became independent, Pakistan imported most of its essential
commodities from India. Pakistan also exported bulk of its export products to India (approximately 2/3rd of the total export commodities). Due to conflicts in different spheres, trade activities declined sharply between India and Pakistan.

Protectionism: Most of the South Asian countries, laid stress on import activities instead of promoting export activities. This tendency lowered productivity in different sectors of the economy. However, things are changing for the better. The different economies are gearing up to extend cooperation among them. This is evident by the fact that both Pakistan as well as India
lowered trade tariffs in the year 2005


IBSA is a trilateral, developmental initiative between India, Brazil and South Africa to promote South-South cooperation and exchange.

In the aftermath of discussions between the Heads of State and/or Government of the IBSA countries at the G-8 meeting that took place in Evian in 2003, and following ongoing trilateral consultations, the Foreign Ministers of the respective countries met in Brasilia on June 6, 2003. At this meeting between Ministers Nkosazana Dlamini Zuma from South Africa, Celso Amorim from Brazil and Yashwant Sinha from India, the launching of the IBSA Dialogue Forum was formalized through the adoption of the "Brasilia Declaration”.

The main objectives of the IBSA Dialogue Forum could be summarized as follows:

  • To promote South-South dialogue, cooperation and common positions on issues of international importance
  • To promote trade and investment opportunities between the three regions of which they are part
  • To promote international poverty alleviation and social development
  • To promote the trilateral exchange of information, international best practices, technologies and skills, as well as to compliment each other’s competitive strengths into collective synergies
  • To promote cooperation in a broad range of areas, namely agriculture, climate change, culture, defence, education, energy, health, information society, science and technology, social development, trade and investment, tourism and transport.

The IBSA Dialogue Forum has regular consultations at Senior Official (Focal Point), Ministerial (Trilateral Joint Commission) and Heads of State and/or Government (Summit) levels, but also facilitates interaction amongst academics, business and other members of civil society.


1. MERCOSUR is a trading bloc in Latin America comprising Brazil, Argentina, Uruguay and Paraguay. It has Chile and Bolivia as its associate members. MERCOSUR was formed in 1991 with the objective of facilitating the free movement of goods, services, capital and people among the four member countries. MERCOSUR has become a successful market of about 200 million people, representing about 1 trillion dollars of GDP and 190 billion dollars of trade. It is the fourth largest integrated market after the European Union (EU), North American Free Trade Agreement (NAFTA) and ASEAN.

2. India had a total trade of US$ 1416.65 million with MERCOSUR during 2003-2004. Our exports to MERCOSUR were approximately US$ 566.96 million during 2003-2004 and our imports from MERCOSUR were around US$ 849.69 million during the same period. The region still has a huge potential for Indian exports as our share is just 0.83% of the global imports of MERCOSUR. Our major items of exports to MERCOSUR are drugs, pharmaceuticals and fine chemicals, transport equipment, inorganic/ organic/ agro chemicals, cotton yarn and cotton and manmade fabrics, made-ups, readymade garments, dyes, intermediates and coal tar. The major imports into India from MERCOSUR are edible oils (primarily soya), metalliferous ores, metal scrap and non-electrical machinery.

3. A Framework Agreement had been signed between India and MERCOSUR on 17th June 2003 at Asuncion, Paraguay. The aim of this Framework Agreement was to create conditions and mechanisms for negotiations in the first stage, by granting reciprocal tariff preferences and in the second stage, to negotiate a free trade area between the two parties in conformity with the rules of the World Trade Organisation.

4. As a follow up to the Framework Agreement, a Preferential Trade Agreement (PTA) was signed in New Delhi on January 25, 2004. The aim of this Preferential Trade Agreement is to expand and strengthen the existing relations between MERCOSUR and India and promote the expansion of trade by granting reciprocal fixed tariff preferences with the ultimate objective of creating a free trade area between the parties.

5. The India-MERCOSUR PTA provides for five Annexes. These five Annexes had been finalized during six rounds of negotiations in order to operationalise the PTA. These have been signed between the two sides on March 19, 2005, upon the conclusion of G-20 Meeting in New Delhi. The five finalized Annexes are following.

The Andean Community

The Andean Community is mainly a trade block formerly called the Andean Group (Grupo Andino, in Spanish) which saw light after the Andean Pact (Pacto Andino) or more formally the Cartagena Agreement (Acuerdo de Cartagena) was signed in 1969, in Cartagena (Colombia). The CAN (for its current abbreviation in Spanish) is a sub-regional organization endowed with an international legal status, which is made up of Bolivia, Colombia, Ecuador, Peru and Venezuela and the bodies and institutions comprising the Andean Integration System (AIS), which is a series of bodies and institutions that work closely in pursuing the same objectives: to intensify Andean sub-regional integration, promote its external projection, and reinforce the actions connected with the process.
The CAN deals with the following issues:
- Trade in Goods
- Trade in Services
- Customs Union
- Circulation of Persons
- Common Market
- Common Foreign Policy
- Border Development
- Social Agenda
- Sustainable Development
- Economic Policies


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