The expansion of economic and political status was a historical approach that was used by nations and empires to form strong communities with resilient military and economic power. The states integrated into a larger state, which enhanced free internal trade, but controlled between other outside states. Examples of such countries include China and United States. Different states were joined to form large blocks of wider resources and better control of the trade and interactions with other countries. As many countries became sovereign, particularly after WWI, countries established a General Agreement on Tariffs and Trade, which would reduce the barriers and facilitate movement of goods and services across borders (Yamanaka, 2014). The agreement led to the formation of a World Trade Organization platform, which was responsible for the reduction of trade obstacles, assessment of the application of rules by members, reviewing of trade policies, and settling disputes. The trade between countries grew significantly through the imports and exports, but the neighboring countries formed Preferential Trade Areas to consolidate trade and economic corporations in their regions. This formation advanced to free trade areas where barriers such as tariffs and quotas were removed. Some of the free trade areas today include NAFTA (in North America), Greater Arab Free Trade Area (in the Middle East), and SAFTA (in South Asia). In this aspect, the free trade area of focus is the South Asia Free Trade Agreement (SAFTA).
The area was formed by an agreement reached by member states in 2004, at a summit held in Pakistan. The member states include Afghanistan, Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan, and Sri Lanka, which are the South Asian states. The formation of SAFTA was a demonstration of commitment to strengthening the economic cooperation that would enhance the realization of the trade and development potential in the regions. The motive was to maximize the benefit to the people in the region, build a spirit of mutual accommodation, respect of sovereign equality, and territorial integrity. The SAARC Preferential Trading Arrangement formed in 1993 established the basis upon which the member states agreed to move ahead and agreed on the free trade area (SAARC, 2009). In addition, the fact that other region, including North America and Europe had successful established free trade areas motivated the governments in South Asia to establish their own. The integration aimed at providing the differential support and development needs of the least developed countries in the region. In addition, the trade area aimed at achieving free movement of goods and people among the member states. In essence, SAFTA aims at reducing the customs duties to 0% by 2016, which is ten years from 2006, the date the agreements came into force.
The process of establishing and maintaining operations in a free trade is complicated and takes a lot of time because of the sensitive aspects involved. The successful execution of SAFTA would depend on the strength of institutions overseeing its implementations. Guided by this realization, the agreement established SAFTA Ministerial Council, which is made up of commerce ministers of the member states (SAARC, 2009). The board anticipates to meet regularly at least once per year to look at the progress made, highlight areas of concern, and strength to process towards the total free trade. SAFTA Committee of Experts was established to assist the ministers on the best practices, which would support the realization of the integration objectives.