Indian Ocean Rim Association: India's Trade Potential With Member Nations

Introduction

Regionalism is a new concept and it is a mid-way between Nationalism and universalism, depending on a certain degree of shared economic, political and ideological interests. Regionalism is a collective action at regional level to achieve national objectives. The variety's regional financial provisions, now more widely acknowledged, arose and were continuously developed in multiple areas of the developing world under colonial rule between 1870-1950. Regional cooperation arrangements existed under British and French colonial rule in South Asia, East Asia, and the Middle East as well as in various sub-regions of Africa and Caribbean. The world witnessed simultaneous formation of political regional groupings (Erokhin, 2016). Most important among political regional arrangements have been Arab League, Organization of African Unity (OAU), Organization of Islamic Conference (OIC), South Asia Association for Regional Cooperation (SAARC), and ASEAN Regional Forum (ARF). Onset of economic regionalism began right back from the 1950s. But first forceful appearance was that of the OPEC. Many other economic regional formations like SADC, ASEAN, NAFTA, G-15, and SAFTA are the representatives of progressively changing version of economic regionalism. Earlier, these were formed with the basic objective of bargaining with developed nations as far as the prices of raw materials and other commodities are concerned. In 1996, 88 regional integration agreements were counted by the World Trade Organization (WTO). Regional integration agreements cover motive statements (APEC), preferential trade agreements, free trade treaties, custom unions, to the common market with its freedom movement for labor and capital.

The 1990s have witnessed significant changes in the world’s economic environment. A number of steps have been taken towards formation of mega blocks in Europe, western hemisphere, and Pacific basin. The process of formation of new trading blocs is called new regionalism. Moreover, regionalism has become universal phenomena on the one hand and a reality on other hand. It induced the different playing partners to achieve their common goal and to reach to a particular agreement. The regionalism as a concept has been perpetuating through a large number of regional blocs like ASEAN, Caribbean Community and Common Market (CARICOM), Central American Common Market (CACM), Common Market for Eastern and Southern Africa (CAMESA), NAFTA, OPEC, MERCOSUR, WTO, and Indian Ocean Rim Association – Association for Regional Cooperation (IOR-ARC).

Gamage (2016) stated that in the case of international trade, oceans were an essential source for export and import. First, over 80% of world trade is conducted via the seas; maritime transport is the backbone of international trade and, by extension, the global economy. The primary objective of the blue economy is recognizing the oceans as the latest frontier of economic development – essentially as a strategy to explore the ocean's potential as a source of resources, livelihood, and services. There are two main elements of this economic development model which warrant further elaboration. The first is that of sustainable development. Blue economy considers the sustainable utilization of oceanic resources to be significant, albeit as a secondary priority.

Background

The Indian Ocean Rim Association (IORA) was started with the purpose of strengthening regional cooperation and sustainable development significantly in the Indian Ocean Region. It is a regional forum which focuses on bringing together representatives of government bodies, business, and academia, for promotion purposes and to create co-operation and healthy relationship among them. It relies largely on the region's trade facilitation and investment, promotion and social development on the values of open regionalism to strengthen economic cooperation.