Chair: Amb (Retd.) Kanwal Sibal
Panellists: Ajay Bisaria, Kiyoshi Taniguchi, Evaz Bahmanzadeh and Ali Akbar Safaei.

Panellists in the session discussed a range of issues concerning Central Asia, ranging from India’s engagement in the region, macro economic situation and role of international organizations in this area to developments in the International North South Transport Corridor project.

Amb (Retd.) Kanwal Sibal highlighted India’s long standing cultural and religious ties with Central Asia and observed that the country continues to enjoy immense goodwill in the region. He shed light on various challenges that hinder India’s participation in the region and felt that geographical connectivity remains the key impediment in realising the true potential of the relationship. Amb Sibal argued that the end of Cold War has brought about a complete regional transformation of geopolitics in the Eurasian space. Russia, China and the US have all been trying to assert their influence in the region. Of late, there has been an emergence of economic and security institutions in the region, the impact of which remains to be seen.

Mr. Ajay Bisaria elaborated on India’s relationship with countries in Eurasia. The year 2012 will see the culmination of two decades of establishment of diplomatic ties with most of the countries of the region. During this period, one has witnessed intense political engagement and a constant search for newer ways of economic engagement. He highlighted India’s time-tested and multidimensional strategic partnership with Russia and observed that there has been a significant improvement in the relationship with Ukraine, Armenia, Azerbaijan, Georgia, Belarus and Turkey.

Mr. Bisaria dwelled on the immense importance of Central Asia for India and firmly asserted that the country intends to stay clear of the ‘Great Game’ discourse. India will prefer to build the relationship based on political, economic, cultural, multilateral and development partnerships and not be driven by an exclusive objective of gaining access to resources. In the recent past there has been active cooperation over issues of common interest including terrorism, drug trafficking, trade, capacity building and human resource development.

He outlined six challenges – three economic and three political - that India can face in the region over the next decade. They include:

1. Stepping up economic linkages: Trade and economic links continue to be far below their potential. The private sector and entrepreneurs of both the countries must be actively engaged. Reviving connectivity, both in terms of decision making and on the ground, will be crucial. The governments are committed to creating a facilitating environment for the private sector to forge commercial ties while assuming reasonable commercial risks.
2. Improving energy linkages: The energy potential of Central Asia is yet to be fully tapped. ONGC Videsh Limited had made a breakthrough in Sakhalin–1. It has also obtained a stake in Satpayev oil field in Kazakhstan. Besides the TAPI pipeline, India is also looking to deepen the civil nuclear cooperation with Russia and Kazakhstan.
3. Finding new areas of cooperation: There are many opportunities for India to explore in the field of IT, Pharmaceuticals and management contracts. These are the sectors that do not require physical connectivity and are part of India’s efforts to diversify its economic relationship.
4. Addressing common security challenges: All countries in the region have a stake in ensuring Afghanistan’s security and stability. Afghanistan’s entry into SAARC has resulted in South and Central Asia being contiguous neighbours. Bilateral and multilateral dialogues need to be held in order to formulate strategies to tackle common security challenges.
5. Leveraging Multilateralism: Collective advantages can be sought through multilateral mechanism. India sees Shanghai Cooperation Organization as an important organisation for regional economic development and cooperation, to tackle terrorism and drug trafficking and engage Afghanistan for a regional solution. India is also exploring the possibility of a Comprehensive Economic Cooperation Agreement (CECA) with the Customs Union of Russia, Belarus and Kazakhstan.
6. Engaging people: There is a need to ensure greater people to people contact especially at a time when new democratic institutions have started evolving in the Eurasian region.

Mr. Kiyoshi Taniguchi deliberated on the macroeconomic situation in Central Asia. Despite the economic crisis, countries of the region have done exceedingly well on account of the commodity price boom. However, they do not have uniform economic priorities and in fact have diverse fiscal status. They also have a problem in widening their export base because of what economists call the ‘resource curse’ (Dutch Disease). Mr. Taniguchi dwelled on the four priority areas of Central Asian Regional Economic Cooperation (CAREC). These include transport, trade facilitation, trade policy and energy. Inter-regional trade has increased by close to five times on account of massive investment in these four sectors. Mr. Taniguchi suggested that CAREC’s goal should be to facilitate the entry of its member countries into WTO. He asserted that these countries must take ownership of their economic development plans and try integrating it within the regional context. The role of international institutions should be that of a facilitator for economic development through financing, capacity building, providing a platform for knowledge sharing and information dissemination.

Mr. Bahmanzadeh highlighted the advantages of the International North South Transport Corridor (INSTC). In the recent past, the Bafq-Masshad Railway and Qazvin-Rasht-Anzali-Astara Railway lines have been inaugurated. The latter is the missing link in the North – South Corridor that may cut down the travel distance between Finland and India. Mr. Safaei briefed the audience on the Shahid Rajaee Port Complex. It comprises of eleven major ports and can provide access to a majority of Asian states, Russia and even northern Europe through a network of railways and roads. The complex is in a special economic zone.

The discussions brought to light the following major points:

1. Bandar Abbas is now connected through a railway network and the Anzali gap in INSTC needs funding.
2. Sixty percent of the development work in Chah Bahar has been completed and by 2012 the container terminal will be built and road connectivity established.
3. India is trying to play a more meaningful role in the SCO and has not received any proposal to join CAREC.
4. There is a pressing need to harmonize the interest of INSTC project members, especially India, Russia and Iran.

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