#dnaEdit: Looking East towards the rising sun may raise hopes for the region

Standing at the Wagah border near Amritsar in India from where you cross into Pakistan, you see pandemonium unfold. Trucks jostle for space, porters line up to carry goods from them to checking before loading onto other trucks. Overall it's a mess, as trucks cannot travel across the border and vice versa. The scene is a bit chaotic, and controlled by a bit of mafia-style groupings. But clearly, the economies on the west, which are primarily Afghanistan and Pakistan, want to trade, even though the relationship between India and Pakistan may not be anything to write home about.

India and its trading partners in the east
The size of the Indian economy is $2.1 trillion. India trades globally using the larger ports but is restricted with its infrastructure. The economies in the east have flourished in the last few years and the two regions have traded heavily with each other. According to a 2015 joint study by Asian Development Bank and Asian Development Bank Institute, cross-regional trade between South Asia and South East Asia has increased 23 times, from $4 billion to $90 billion between 1990 and 2013.

The need of the hour is harnessing the potential of the economies in South East Asia and South Asia, by commencing trade with each other. Currently, the South and South-East Asian region countries are dependent on developed countries for trade.

Infrastructure
One of the challenges for doing business with the east has been infrastructure. The road towards South East Asia has to travel through Bangladesh, a country that usually is good to do business only under the government of Sheikh Hasina. Whenever Khaleda Zia comes to power, the momentum gets killed.

Roads
The BBIN motor pact connects Bangladesh, Bhutan, India and Nepal. The regional connectivity between the four countries can play a major role for the success of these economies of South Asia. Countries like Nepal and Bhutan are landlocked, and gaining access to the seaports in India and Bangladesh can help them tremendously.
The Nepalese and Bhutanese have a very liberal arrangement with India, but with Bangladesh it is a bit more complex. Consequently, Indian trucks carrying goods bound for Bangladesh have to unload their consignment at the border, which then have to be loaded on to trucks lined on the Bangladesh side. The same procedure applies for goods entering India from Bangladesh. A good pact can act as a stabilising factor for this part of the South Asian region and the blow hot, blow cold relationship with Bangladesh can permanently change.
The next big play is the IMT – India, Myanmar and Thailand – trilateral highway. These two together have the great potential for regional integration for SAARC and ASEAN. For this to succeed, it's essential that the countries sign the corresponding transit agreements for the smooth transfer of goods and increase the trade.

Ports
Sea transport is always considered the cheapest mode of transportation, and infrastructural development of seaports can tremendously increase trade in this region. All these countries have long coastlines.
The region faces difficulties: the ports are mostly shallow; the turnaround time of ships is high; there are deficiencies in draft, capacity, operational efficiency, and road and rail access; there is inadequate development of dry ports; logistics and supply chain costs are very high due to lack of infrastructure and various rigmarole laws and paperwork governing shipping. Each country needs to put its house in order to overcome these bottlenecks.
Some of the major ports closest to connecting the two sub regions — Kolkata, Chittagong and Yangon —suffer from capacity limitations, including shallow channels, operational inefficiencies, and restrictions on road and rail access. In contrast, Chennai and Ennore ports are in good condition. However, the Bay of Bengal ports collectively face a systemic problem in that they are largely shackled to the hub-and-spoke feeder system that significantly raises transport costs. If major port investments can substantially increase direct calls or in-line trans-shipment of large-scale container ships, this could dramatically lower costs, which could significantly increase the attractiveness of manufacturing activity in the region, especially that related to supply chains.
In addition, the river linkages have broken down from the time of partition. It is only now that the government of India and government of Bangladesh have started to work in tandem to open up river-based transportation from Assam to Kolkata via Bangladesh. These are very progressive developments, which need to be accelerated.
Improving the quality of regional transport infrastructure, and adding it where it does not exist, will lower unit transport costs, reduce shipment times, and increase throughput, all of which can lead to increased trade and greater benefits.

Railways
Gauge lines are different in each country. And the investment required to develop this is huge. So it can be put on hold in the list of priorities. Also, not every country has great railway systems. Travelling through China-Mongolia-Russia, I realised that if your rail tracks are not of the same gauge, you can get over the challenge by removing the tracks with all the goods still in the carriages but it is a painfully long process. So the challenge can be overcome but not without a well-thought-out plan.

The investment and its returns
According to ADB and ADBI figures, while the costs of investment in the infrastructure are close to $62.6 billion, it could generate as much as $358 billion, since it will impact the GDP of all the nations. The largest benefit though will be from showcasing the gains of living in harmony and mutual growth. The failure to work together has been the region's biggest plague.
One of the other game key drivers could be trans-national land-based optical fibre that follows the railway lines and the road infrastructure, making communication between these countries almost local.
Europe took advantage of their cross-border infrastructure and improved its economy drastically, and has now the potential to stand against many challenges together. The recent challenges because of the refugees and border checking have shown the kind of losses that industry has to face in delayed transportation and productivity. It is estimated that the losses are three billion euros, and may reach as much as 10. But the South and South-East Asia can begin seeing how connectivity may bring about regional transformation.

(Rohit Gandhi is the Editor-in-Chief of ZEE's upcoming global English news channel WION. Follow him on Twitter @RohitGandhi_)