THE POLITICAL-ECONOMY OF REGIONAL COOPERATION IN SOUTH-ASIA

Will economic interests drive the South Asian countries toward greater cooperation! Or will the continuing political tensions among South As ian countries and the low-intensity, informal war between India and Pa kistan over Kashmir deprive the region of a historic opportunity to ac hieve cooperative development in the post-cold war era? This article e xplores these questions by examining (a) the domestic political and ec onomic dynamics of South Asian countries in order to underline impedim ents and opportunities for expansion of regional cooperation, (b) the current level of these countries' economic interactions and potential for regional economic interdependence, and (c) international compulsio ns. The analysis suggests that to the extent that political tensions r emain unresolved, any substantial growth of regional economic cooperat ion is unlikely. Rather, regional cooperation in South Asia will pass through a stop-and-go pattern of growth in which state-directed, limit ed, pragmatic cooperation on specific technoeconomic issues is possibl e over a period of time.