Conflict in South Asia
Perceived as one of the most unstable regions in the world, South Asia is home to persistent inter-and intra-state conflicts among member countries. Some of these were inherited at the time of independence and can be attributed to the process of creation of South Asian nations. These include disputes on the demarcation of boundaries and territories as well as disputes that are a consequence of the accompanying distribution of natural resources across borders. Others are of more recent origins and include phenomenons like cross-border illegal migration and terrorism. The most persistent bilateral conflict in South Asia has been between India and Pakistan. Bilateral political relations among other country pairs in the region have also not been devoid of tensions. Political regimes that have alternated between democracy, monarchy and military rule at different time points in Nepal, Pakistan, Bangladesh and Sri Lanka have in their own way contributed to the hostilities and to its varying intensity over time. Given below is a brief and neutral account of the nature of inter-state conflicts observed in South Asia, followed by a chronological presentation of specific conflict events, which are also interspersed with confidence-building measures that these nations have attempted to establish among themselves from time to time. An attempt is also made to draw some initial impressions of the extent to which regional, bilateral and civil conflict impacts bilateral trade from a graphical analysis of these variables for the region. This exercise is undertaken as a prelude to the formal econometric estimation of trade costs of conflict undertaken in the next chapter.