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ESCAP-SSWA Development Paper 1305, July 2013
Economic Integration in ‘Heart of Asia’ : Focusing on South Asia-Central Asia Economic Linkages, by Ram Upendra Das

This paper, prepared for ESCAP-SSWA by Dr. Ram Upendra Das, explores the potential and challenges to regional economic integration in the ‘Heart of Asia’, defined to include Afghanistan and neighbouring countries in Central and South Asia. The paper shows that the macroeconomic contexts of the two subregions are highly amenable to integration across a range of areas, especially through strengthening trade and investment linkages and that regional trade integration is a key opportunity for both subregions to foster synergy for mutual benefit, although many bottlenecks exist. It shows that Central Asian and South Asian integration would also greatly facilitate complementary export growth between the two subregions.

The paper puts forward three key recommendations for moving forward and enhancing integration between the two subregions: Greater trade integration through WTO accession and a Central Asia-South Asia FTA/CEPA; greater connectivity in transport, communications, infrastructure; and finally specific initiatives in targeted sectors such as banking and energy cooperation.

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