MULTILATERAL MARKETING AND PROCUREMENT ARRANGEMENTS BETWEEN SOUTH ASIAN COUNTRIES

This article explores the potential for establishing multilateral marketing and procurement arrangements among the countries of South Asia as a means of enhancing regional economic cooperation. It argues that beyond traditional trade liberalization, joint initiatives in marketing and procurement could offer significant benefits. The study identifies key commodities, such as jute, tea, and cotton, where South Asian countries are major global producers but often compete against each other, driving down prices. It proposes the creation of multilateral marketing boards or cartels to coordinate export strategies and secure better terms of trade. On the procurement side, the research examines the potential for joint purchasing of essential imports like petroleum, food grains, and industrial machinery to achieve economies of scale and enhance the region's collective bargaining power. The paper concludes that such arrangements could be a practical and effective step towards deeper economic integration within the SAARC framework.

While the discourse on South Asian economic cooperation has often focused on the grand project of a free trade area, this paper explores a more targeted and pragmatic approach: multilateral cooperation in marketing and procurement. The analysis begins by highlighting a structural weakness in the region's position in the global economy. For several key export commodities like tea and jute, South Asian countries collectively hold a dominant market share, but a lack of coordination leads them to compete destructively, to the benefit of international buyers. The paper proposes the establishment of joint marketing consortia, modeled on organizations like OPEC, to manage supply, set floor prices, and engage in joint promotion, thereby maximizing export revenues for the entire region. The second part of the study focuses on the import side. It argues that by pooling their demand for critical imports such as crude oil, edible oils, and capital goods, the SAARC countries could negotiate much more favorable terms with international suppliers. The paper outlines the potential institutional frameworks for such joint procurement arrangements, from information sharing networks to a fully-fledged regional procurement agency. The findings suggest that these functional, project-based forms of cooperation could offer tangible economic benefits, build trust, and serve as important building blocks for the more ambitious goal of creating an integrated South Asian market.