Transit and Trade Barriers in South Asia: Multilateral Obligations and Development Perspective

Abstract

With the South Asian Free Trade Agreement, South Asian countries are now looking towards deeper integration of the region. In reality, South Asia is far from realizing its full trade potential. One of the critical factors preventing South Asia from achieving its full potential is the absence of regional transit. Unlike the European Union, South Asian countries do not have a regional transit arrangement, although partial transit exists for landlocked countries such as Afghanistan, Bhutan and Nepal. This paper highlights, among others, the importance of transit as a major source of advantage for regional as well as international trade in South Asia.