Notes From the Field: India, South Asia Buying into Integration

Editor's Note: "Notes from the Field" is an occasional feature where we let World Bank professionals conducting interesting trade-related projects around the globe explain some of the challenges and triumphs of their day-to-day work. The views expressed here are personal and should not be attributed to the World Bank. All interviews have been edited for clarity.

The interview below is with Ashish Narain, a Senior Economist at the World Bank Group’s Investment Climate Department. He is based in India from where he manages the World Bank Group’s South Asia Regional Trade and Investment Project. He spoke with us about his project, his personal connection with the region, and the evolution of regional trade facilitation in South Asia.

The Trade Post: How did you come to work on trade logistics in South Asia?

Mr. Narain: My training was in international trade. I’ve always had an interest in the subject. When I joined the World Bank’s PREM unit in India in 2004, I was tasked with looking after regional trade and trade issues in general. We produced a number of reports for the government of India – which they really loved – on liberalizing trade in services and agriculture. At that time, regional trade facilitation in South Asia was still in its very early stages. There wasn’t much political backing for it, and there was a lot of distrust among the countries.

We identified the private sector as the best champion, and focused efforts on sensitizing them to the benefits that could accrue in the region from better integration. I moved out of the region, but came back in 2013 to work on a new World Bank Group regional integration program in South Asia. This time, however, I was on the IFC side. By this time, perhaps our earlier efforts had borne fruit because there had been a change in regional governments’ attitude and gradually everyone was moving in the right direction. The window to have an impact was wider, and that really excited me.  

The Trade Post: Can you tell us a little more about the project?

Mr. Narain: I’m managing the South Asia Regional Trade and Investment (SARTI) Project. The trade component aims to reduce the time and cost of trading across four key border posts on the Indo-Bangla-Nepal borders. We're doing this through simplifying and harmonizing procedures and documents, implementing automated processes, and introducing risk management strategies. Plus, we're helping to build the capacity of customs authorities and enhance peer-to-peer cooperation.

We’ve had some exciting quick wins in the first year of the project. Now we are supporting complex legal reforms that provide the basis for the trade facilitation improvements we want to undertake. Our hope is that, going forward, we’ll be able to increase coordination among authorities in all three countries so they can sort out many of the day-to-day issues, and even some of the larger policy issues, that come up.

The Trade Post: What has your experience been like working in what seems to be a very complex environment?

Mr. Narain: South Asia is definitely a very complex working environment. Regional countries do not always see eye-to-eye, and there are frequent political irritations that crop up. One of our countries, Nepal, is a fragile state. Everywhere there are frequent changes in personnel that affects service delivery. At the same time, we’ve been able to strike a very good relationship with our counterparts, both at the policy and functional, or technical, level. This, and persistence, have helped us move the program forward even during times of change.

The Trade Post: South Asia is one of the poorest and least integrated regions of the world. How will this project contribute to shared prosperity and poverty reduction?

Mr. Narain: Nepal, being a landlocked country, is dependent on its neighbor, India, for a large portion of its trade. For Bangladesh, trading with the region could help diversify its export basket and grow exports. At a micro level, including in India, pockets of extreme poverty tend to be concentrated around the border, often because the natural markets happen to lie on the wrong side of the political border. Trade facilitation is therefore essential for higher growth and faster poverty reduction in the eastern part of the sub-continent.

Making this happen is a tough job, and all donors need to work together to make it work. We are working with World Bank colleagues, DFID [United Kingdom's Department for International Development], and coordinating with the wider donor community, including with the Asian Development Bank. In Nepal, for instance, there’s been true coordination between the IFC and the World Bank, with each bringing their strengths to the board. The Bank team has been rehabilitating critical road infrastructure linking Nepal with India. And the IFC, for its part, has been complementing that effort with trade facilitation projects that are necessary to help reap the benefits from this new infrastructure.

The Trade Post: With so much happening in the region, what is it that you enjoy most about working in South Asia?

Mr. Narain: What really excites me is the prospect of making a difference. It has taken us almost a decade to change attitudes and get to the point where almost all civil society and governments have bought into the idea of integration. The conversation has shifted from whether we should do it, to how we should do it. Now I’m excited, even a bit impatient at times, for the World Bank Group to support and help implement the change.

The Trade Post: So what’s next?

Mr. Narain: This project has been in implementation for about one-and-a-half years now. We’ve made a huge amount of progress and moved much faster than we anticipated. We just signed an agreement with the government of Bangladesh to help develop a national trade portal, which will help with the dissemination of trade-related information – and this is a notable achievement. Now, the challenge is to move into more complex areas, such as streamlining the implementation of sanitary and phytosanitary standards. Agricultural products are important in regional trade here, and issues with these standards remain an important barrier.