China’s entry into SAARC: Gateway to South Asian prosperity

"CHINA as a full member of SAARC? At first, the idea may sound bold, even strange. But it could be the spark the region needs to move forward. For years, SAARC has carried a huge promise; a platform to connect markets, people, and ideas across South Asia. Yet political tensions have often slowed its progress. Bringing China into the fold could give SAARC fresh energy, new opportunities, and a stronger voice in the world."

- By Keerthi Gunawardane

China's entry could change that. With its huge economy, global influence, and experience in building connections, China can inject new life into SAARC. It could open bigger trade opportunities, boost regional projects, and make SAARC more visible on the world stage.

The economic argument for China's full membership in SAARC is not merely compelling; it is an undeniable reflection of the present-day reality. China is no longer a peripheral trading partner; it has fundamentally rewired the economic circuitry of South Asia, becoming the single largest or one of the top two trading partners for every single nation in the bloc. SAARC represents a market of over 1.9 billion people, but intra-regional trade languishes at a dismal 5% of its total trade, compared to 35% in ASEAN. China, as the world's second-largest economy and the largest trading partner of most SAARC nations, can fundamentally alter this equation.

Despite geopolitical tensions, China remains one of India's largest goods trading partners, with bilateral trade hitting a staggering $ 130 billion in 2024. This figure dwarfs India's trade with any SAARC nation. China is Pakistan's largest trading partner and its largest source of imports. The China-Pakistan Free Trade Agreement has solidified this relationship, which is the cornerstone of the $65 billion China-Pakistan Economic Corridor (CPEC).

Sino Bangla bilateral trade exceeds $25 billion. It is the primary source of imports, particularly of machinery, textiles, and electronics, crucial for Bangladesh's booming manufacturing sector. Similarly Nepal's economic dependency on China has grown exponentially. China is its second-largest trading partner and a vital source of foreign investment. Trade, heavily skewed towards Chinese imports, is valued at over $ 2 billion, and Nepal actively seeks to reduce its trade deficit through greater market access for its goods.

China is one of Sri Lanka's largest trading partners