South Asia’s dominance in maritime trade
The Chinese flotilla skirting along the Indian Ocean Region (IOR) intermittently and the US Navy’s presence in the Malacca Straits tells us this: the centre of gravity in world affairs has shifted to Asia. And the IOR is the heart of all maritime trade and security. Geopolitics is perhaps the biggest driver of sea and land transportation sometimes uniting nations and sometimes leading them adrift.
The fight for dominance has led the countries to develop new terminals, expand existing ones and improve their inland transportation. The importance of the IOR in governing the high seas has even led China and Japan to invest many infrastructure projects in three main maritime nations – India, Sri Lanka and Pakistan. China’s interests in the Gwadar Port, the One Belt One Road in Pakistan and its keenness in developing the Hambantota port states the obvious. Bangladesh has made a surprising entry developing new ports along its shores. 2017 has been an interesting year and so the next year will be something to look forward too.
If the past years have been an opportunity for each country to work in silos, the coming years present an opportunity to grow as a region. If India’s dominance is in the success of the Sagarmala programme, Sri Lanka’s is in being the biggest transhipment hub of the region. Pakistan and Bangladesh are gearing themselves up to be windows to the Middle East and East Asia. For these countries to grow in economic superiority, it is imperative that they work together. This will lead to better regional stability and security. Each can play to its strengths and fall back on another for help in weaker segments of trade.
That many shipping lines have deepened their inland services investment in these countries is itself reason to function as one big enterprise sharing the seas and the opportunity to be regional superpowers. But India and Sri Lanka have to tick a few boxes off before they can make a mark on the world stage. Slashing logistics cost to a single digit and investing a few hundred million in improving its first and last-mile connectivity will improve efficiency and cost effectiveness of delivering cargo to and from the ports. Two challenges, however, stare at the face of these reforms. Funding and speed of execution. Ensuring local populations and governments are open to the major economic and social change will be key to the speed with which the program moves towards its objectives.
For these countries to grow in economic superiority, it is imperative that they work together. This will lead to better regional stability and security.