To my mind, SAARC lacks a vision at the moment. What does such a vision mean for South Asia? I believe SAARC can represent a single, integrated economy with seven polities. Why can't we have one economy and seven polities for the region?

Look what's happening in the rest of the world. A Europe that was so divided is now trying to come together as an European entity. In fact, South Asia the poorest region of the world is trying to compete with other regions that are becoming more economically viable, through bodies like the EU, or ASEAN.

In contrast, we in South Asia have never taken a chance on each other's markets, even as we invite all the world to take a chance on our markets. Less than 10 per cent of our trade is with each other.

Yet I see a vision where, maybe through an institution like SAARC, Nepal becomes the hydro-electric capital for South Asia, providing cheap electricity for their own benefit and for that of the other countries of the region as well. Bangladesh, with its large natural gas resources and sea beds, could provide the resource base for viable fertilizer and petro-chemical industries.

I see India emerging from its stance of a frustrated industrial giant that it is today and becoming the main supplier of capital goods and medium-tech consumer goods in the region. I see it developing a whole new technology for South Asia. I see Pakistan emerging by learning from India on how to double its agricultural production and also getting more into the consumer goods market.

Together with this vision, these countries need good governance. Good governance really means the rule of law and justice; it means that no discretionary powers should be vested with the state so that politicians can enrich themselves at the cost of the electorate. It means transparency. Good governance means investing in human capital and social capital. In Japan, 85 per cent of the total wealth today is human and social capital. Over all, two-thirds of the wealth of nations lies in human resources.

At the same time I would like to state that while South Asia may have lost in terms of economic and technological growth, it has not lost out culturally. While we may be poor , ours is a proud civilization.

(Dr Mahbub ul Haq is president of the Human Development Centre, Islamabad, and the chief architect of UNDP's annual Human Development Reports)