Rebuilding the Commonwealth
There are several possibilities that could be explored for an energy specific FTA among Commonwealth nations.
9 April 2018 3:13 PM GMT
Possibly, the Commonwealth of Nations is the earliest multilateral body of countries bound together by a shared colonial culture, administrative language, common values, human rights, unified legal system, democracy, and stable governance. Its formation dates back to the Statute of Westminster, an Act of the British Parliament passed on December 11, 1931. The Statute established the independence of the Dominions (semi-independent polities under the British Crown), creating a group of equal members where, previously, there was only one supreme — the United Kingdom. The solitary condition of membership of that embryonic Commonwealth was that a member state must be a 'Dominion'. Thus, the Independence of Pakistan (1947), India (1947), and Sri Lanka (1948) saw the three countries join the Commonwealth as independent Dominions. On the other hand, Burma (1948) and Israel (1948) did not join the Commonwealth, as they chose to become republics.
With India was on the verge of promulgating a republican Constitution, the Commonwealth Prime Ministers Conference in 1949 was dominated by the impending departure of over half of the Commonwealth's population. To avoid such a fate, it was proposed that the republics be allowed to remain in the Commonwealth, provided they recognised King George VI as the 'Head of the Commonwealth'. Accordingly, eight governments, Australia, Canada, Sri Lanka (formerly Ceylon), India, New Zealand, Pakistan, South Africa and the United Kingdom, came together to form the new Commonwealth in 1949. That arrangement (London declaration) established the only formalised rule that the Commonwealth members must recognise the King or the Queen as the Head of the Commonwealth. Thus, the members had declared themselves, to be "united as free and equal members", co-operating together in the pursuit of peace, liberty, and progress.
Almost seven decades later, the Commonwealth membership has grown to fifty-three countries. It operates through the intergovernmental consensus of the member states, organised by the Commonwealth, the Secretariat and the non-governmental organisation—the Commonwealth Foundation.
The demographic and economic fact sheet of the Commonwealth nations is very impressive. The combined population of the Commonwealth nations is 2.4 billion, (which is nearly one-third of the global population) of which more than 60 per cent of the populace is aged 29 years or under. The Commonwealth is spread across the globe and includes both advanced economies and developing countries. It encompasses Africa (19 countries), Asia (seven countries), the Caribbean and Americas (13 countries), Europe (three countries), and the Pacific (11 countries). The Commonwealth's strength lies in its shared values and diversity. Thirty-one members are small states, usually with a population of well fewer than 1.5 million, and 24 members are small island developing states. The Pacific nation of Nauru is the smallest Commonwealth member country with a population of about 10,000. The most populous member country is India with over 1.2 billion people.
The economic data of this dynamic grouping is equally impressive. The combined gross domestic product of the Commonwealth countries was estimated at US$10.4 trillion in 2017 and is, additionally, predicted to reach US$13 trillion by 2020. The bilateral costs for trading partners in the Commonwealth countries are on an average 19 per cent less than those in non-member countries. And 10 of the top 20 global emerging cities are in the Commonwealth: New Delhi, Mumbai, Nairobi, Kuala Lumpur, Bangalore, Johannesburg, Kolkata, Cape Town, Chennai and Dhaka (of these, five are Indian cities).
Surprisingly, all these commonalities have not culminated to result in any formal economic agreement among the member states of the Commonwealth. The activities have remained confined, predominantly, to cultural pursuits, academic engagements, and sporting activities.
India enjoys a significant position in the Commonwealth because of its population (almost half of the total Commonwealth population) and a vast economy (its GDP is nearly one -third of the total Commonwealth GDP). Moreover, being a strategically important nation in Southeast Asia, India can act as the most crucial nation connecting the Caribbean and African states on one side and the Pacific nations on the other. Moreover, after Britain's exit from the EU in 2019, she may find Commonwealth as an established platform to boost her battered economy.
Indian policymakers are in a total state of confusion over how to react to China's OBOR (One Belt One Road) and Sea Silk Route initiatives. Apprehending Chinese dominance, the government of India has stopped financing the Institute of Chinese Studies, New Delhi. Alternative trade blocs like the Regional Comprehensive Economic Partnership (RCEP) –a proposed free trade agreement (FTA) between the ten member states of the Association of Southeast Asian Nations (ASEAN: Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand, Vietnam) and the six states with which the ASEAN has existing free trade agreements (Australia, China, India, Japan, South Korea and New Zealand), the Asia Africa Growth Corridor (AAGC) and the Bay of Bengal Initiative for Multi-sectoral, Technical and Economic Cooperation (BIMSTEC: India; Bangladesh; Myanmar; Bhutan, Nepal; Sri Lanka; Thailand; Japan), among others, are being explored.
Nonetheless, policymakers have not yet seriously considered the Commonwealth as a viable Free Trade bloc. Pre-existing colonial baggage and the high-handedness of the previous master might have acted as a severe mental block. For a win-win situation, the UK will have to initiate major reforms in the monarchical structure of the Commonwealth to exploit the trade and economic potential of this oldest political bloc.
Instead of a multi-sectoral FTA, to begin with, we have suggested for an energy specific FTA in the Commonwealth region for two reasons. First, for all the member nations, large or small, energy is still a vital economic input and most of the Commonwealth nations are not self-sufficient in energy. Second, like in the previous century, in the 21st century also, due to impending concerns of Climate Change, energy, especially the new and emerging variant green sources of energy, will be the major game changer. As a huge potential of energy trade (both product and services) exists among the Commonwealth Nations, it is expected that the members will welcome an energy FTA among them.
It may be noted that the Commonwealth initiative was taken much earlier than the initiatives that led to the formation of the European Union. It was only in 1951 that the concept of a 'European trade area' was first established. The European Coal and Steel Community had six founding members: Belgium, France, Germany, Italy, Luxembourg and the Netherlands. That small initiative ultimately led to a strong European trade bloc of 28 countries.
If Britain learns from its EU experience and takes initiatives to make the Commonwealth a truly democratic institution then it may emerge as the main competitor to the European Union and many other regional blocs in future.
(The author is Senior Consultant, Center for Studies in International Relations & Development. The views expressed are strictly personal)
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