Muizzu's SAARC call puts a 1.94-billion-person bloc back on the agenda

Speaking at the Independence Day ceremony on 26 July, before 113 diplomats representing 43 countries and international organisations, President Dr Mohamed Muizzu called for the urgent revival of the South Asian Association for Regional Cooperation and the resumption of regular meetings of SAARC Heads of State or Government.

He went further than a statement of principle. The President said the Maldives stands ready to use its good offices to facilitate discussions among the parties whose differences have kept the organisation frozen, and — where required — to support a mediation process aimed at restarting the summit cycle. The offer was placed within the Government's "Maldives First" foreign policy, alongside the country's record in the Organisation of Islamic Cooperation and its advocacy among Small Island Developing States.

SAARC has not held a Heads of State summit since November 2014. The organisation has, by the President's own description, been "largely dysfunctional for approximately nine years."

A functioning SAARC is essential to the future stability, security and development of South Asia. Its revival can no longer be deferred.

The bloc on paper

The first thing to establish is scale, because the figure most often quoted in public discussion — 1.5 billion — understates it. On the latest compiled national data, SAARC's eight members hold close to 1.94 billion people, roughly 24% of the world's population, on about 3% of its land area.

Two numbers in that table define the politics of the organisation. India holds 74% of the bloc's people and 79% of its output. The Maldives holds 0.03% and 0.15%. India's population is roughly 2,730 times the Maldives'; its economy is roughly 530 times larger.

Nine years of not meeting has a measurable price

South Asia is the least economically integrated region in the world. Intra-regional trade is under 5% of the region's total trade, against roughly 25% within ASEAN and about 60% within Europe. The World Bank has put the untapped intra-regional trade potential at around $172 billion — trade currently running at roughly one-fifth of what the region's own geography and demand would support.

The South Asian Free Trade Area, in force since 2006, has not closed that gap, largely because long "sensitive lists" of excluded products keep much of the region's actual trade outside the concessional tariff.

Energy security

Cross-border electricity trade in the Bangladesh–Bhutan–India–Nepal sub-region has nearly tripled, from 7.8 TWh in 2013 to about 21 TWh in 2024. In June 2025, Nepal began regular exports of 40 MW to Bangladesh across India's grid under a five-year seasonal trilateral agreement.

That is real progress — and it happened entirely outside SAARC. It was built bilaterally and trilaterally among four contiguous members. The Maldives, which depends overwhelmingly on imported fuel for power generation, sits outside every one of these arrangements, as do Sri Lanka, Pakistan and Afghanistan. A regional energy framework that a functioning SAARC could host would not automatically connect an archipelago to a continental grid, but it would put fuel procurement, storage, renewables financing and emergency supply arrangements on a table the Maldives actually sits at.

Financial market access

The clearest existing example of what regional machinery can do for a small state is the SAARC Currency Swap Framework, revised by the Reserve Bank of India for 2024–2027, with a US$2 billion dollar/euro window and a ₹250 billion rupee window. Under it, the RBI and the Maldives Monetary Authority signed an arrangement in October 2024 providing up to US$400 million under the dollar/euro window and ₹30 billion under the rupee window.

Note the structure. The framework carries SAARC's name, but it is administered by one member's central bank and executed through bilateral agreements — a hub-and-spoke arrangement, not a pooled regional facility. It works. It also means each small member negotiates its own terms, alone. After Sri Lanka's 2022 default, the region has no collective liquidity backstop, no shared framework for sovereign debt workouts, and no common voice in how rating agencies and index providers treat small, tourism- and remittance-dependent economies.

AI: the region holds the inputs, but holds them separately

This is the file where the cost of not meeting is likely to compound fastest, and where the region's assets are most obviously complementary.

The jobs problem is already measurable

The World Bank's South Asia Development Update for October 2025, subtitled Jobs, AI and Trade, sets it out plainly. Between 2000 and 2023, employment in South Asia grew 1.7% a year while the working-age population grew 1.9% — about 10 million jobs a year created against 19 million people a year reaching working age. The Bank warns the region risks "squandering its demographic dividend."

On AI specifically, the region's near-term exposure is limited by the predominance of low-skill, agricultural and manual work. The vulnerable group is narrower and more specific: moderately educated young workers in business services and IT — which is to say, the exact cohort South Asia has spent thirty years building. About 15% of South Asian jobs show strong complementarities with AI, and jobs requiring AI skills already command a wage premium of nearly 30%.

The compute problem is a dependency problem

Where AI is actually built is not evenly distributed, and it is not trending toward evenness. By Epoch AI's measurement, roughly three-quarters of the world's advanced AI computing cluster performance sat in the United States in 2025 and about 14% in China — close to 90% in two countries. World Bank data puts the same picture in infrastructure terms: as of June 2025, high-income countries held 77% of global colocation data-centre capacity, upper-middle-income countries 18%, lower-middle-income countries 5%, and low-income countries less than 0.1%.

UNCTAD's Technology and Innovation Report 2025 projects the AI market at $4.8 trillion by 2033 — roughly the size of Germany's economy — while noting that just 100 firms, mainly in the US and China, account for 40% of global corporate R&D spending; that fewer than a third of developing countries have a national AI strategy; and that 118 countries, mostly in the Global South, are absent from the main AI governance discussions. UNCTAD's own recommendations include shared infrastructure facilities and South–South capacity building — which is, in effect, a description of what a regional bloc is for.

For countries in this position, compute is not simply an input to be purchased. It is a dependency, subject to another jurisdiction's export controls, pricing and priorities. The strategic case for building it regionally is the same case that applies to fuel storage or foreign reserves: a hedge you own is worth more than access you are granted.

The inputs exist — they are just held by different members

South Asia is unusual among developing regions in that it holds nearly every input an AI build-out requires, distributed across members that do not currently coordinate:

• Firm clean power. Bhutan generates effectively all of its electricity from hydro and is carbon-negative. Nepal's installed capacity passed 4,105 MW by March 2026, almost entirely hydro, and it signed an agreement with India in January 2024 to export up to 10,000 MW over ten years. Data centres are constrained above all by firm, low-carbon power on short timelines.
• Demand and capital. India's operational data-centre stock reached about 1.8 GW after the first half of 2026, with capacity additions up 59% and forecasts above 7 GW by 2030. The IndiaAI Mission, funded at roughly $1.24 billion, is deploying more than 10,000 GPUs through public-private partnerships.
• Talent. ICT service exports have risen across Bangladesh, India, Maldives, Nepal, Pakistan and Sri Lanka, and India's services exports alone reached US$165.22 billion in the first five months of FY26. The region's comparative advantage in software services is decades deep.
• Subsea routes and landing points. The Maldives now hosts multiple international cable systems, and in November 2025 Google announced the Dhivaru cable linking the Maldives, Christmas Island and Oman, with a connectivity hub in Addu City built in partnership with the Government of the Maldives, Ooredoo Maldives and Dhiraagu.

The clearest illustration of how these pieces fit is a project that was assembled entirely without SAARC. In June 2026, SATO Technologies signed a letter of intent with Bhutan's Gelephu Mindfulness City Authority to develop a hydro-powered AI compute campus targeting 100 MW and scalable to an estimated 500 MW, beginning with a 5 MW phase. Its stated logic is explicit: Bhutanese hydropower, sited near the Indian border, serving Indian demand centres whose own expansion is constrained by power availability and multi-year grid timelines.

That is a South Asian AI supply chain — one member's clean power, another's demand, third-country capital — and it was arranged commercially, member by member, because there is no regional forum in which to arrange it otherwise.

What a functioning SAARC could actually contribute

It is worth being precise about what a regional body would and would not do. It would not build data centres. What it can do is the unglamorous work that determines whether the pieces above connect:

• Cross-border power rules for compute loads — wheeling charges, transit tariffs, firm-supply guarantees and dispute resolution, so that a data centre in one member can be powered from another without renegotiating from scratch each time.
• Data transfer and residency rules that let a regional cloud region serve eight jurisdictions instead of requiring eight separate builds. Fragmented data localisation is the single most effective way to make regional-scale infrastructure uneconomic.
• Mutual recognition of qualifications and portable skills certification, so that the reskilling the World Bank says the region needs produces credentials that travel.
• Joint procurement and shared-facility access, along the lines UNCTAD recommends, so that smaller members obtain compute at terms they could never negotiate individually.
• A common position in AI governance forums, where 118 developing countries are currently absent and where eight separate South Asian voices carry less weight than one.

The cost argument is straightforward: these are expensive to build eight times over and comparatively cheap to build once.

For the Maldives, the asymmetry is instructive rather than discouraging. The Dhivaru investment brings a connectivity hub to Addu — cable switching, content caching and colocation. Google has been explicit that a connectivity hub is not an AI data centre and draws far less power; the large AI facility in that same network is being built on Christmas Island, in Australian jurisdiction. The Maldives has the landing point and the strategic position. Whether it captures anything further up the value chain depends on power, skills and regulatory frameworks it cannot build at national scale alone — which is precisely the argument for the regional track.

What is actually holding the region back

It is tempting to blame SAARC's design. Article X of its Charter requires that decisions at all levels be taken by unanimity and that bilateral and contentious issues be excluded from deliberations. In practice, any single member can stop anything — and the exclusion of bilateral disputes has not prevented those disputes from freezing the whole body.

But the design is not the binding constraint. The record is:

• 2014 — the 18th summit is held in Kathmandu. It is the last one.
• 2016 — the 19th summit, scheduled for Islamabad in November, collapses after the Uri attack. India withdraws; Bangladesh, Bhutan, Afghanistan and Sri Lanka follow.
• 2021 — an informal SAARC foreign ministers' meeting on the UN General Assembly sidelines is called off for "lack of concurrence."
• April–May 2025 — the Pahalgam attack is followed by India's Operation Sindoor. Trade and diplomatic ties between India and Pakistan are cut, and the Indus Waters Treaty is placed in abeyance — paused, not abrogated, but with real-time hydrological data sharing stopped.
• October 2025 onward — cross-border fighting between Pakistan and Taliban-led Afghanistan begins, with renewed offensives and air strikes in February and March 2026.
• Since 2024 — India–Bangladesh relations deteriorate sharply following the change of government in Dhaka, with trade restrictions and border confrontations.

Meanwhile, India has redirected its regional energy toward BIMSTEC, which adopted a Bangkok Vision 2030 at its sixth summit in April 2025. BIMSTEC excludes Pakistan and includes Myanmar and Thailand — a workable body precisely because it routes around the India–Pakistan problem, but not a substitute for a forum that contains all of South Asia.

So the honest diagnosis is that SAARC is not stuck on procedure. It is stuck because its two largest members have no functioning bilateral relationship, and because at least three further bilateral relationships in the region are under strain at the same time.

What other blocs did differently

The President's statement invoked the European Union — not as a template to copy, but for a narrower point: regional organisations produce results only where members maintain dialogue, preserve institutional continuity and implement what they agree.

The closer comparison may be ASEAN. It also operates by consensus, and it is also regularly criticised for producing lowest-common-denominator outcomes on its hardest files. The difference is that ASEAN has never stopped holding summits. Meetings continued through territorial disputes, coups and border violence. The continuity of the meeting is itself the deliverable — it preserves the secretariat, the sectoral committees and the habit of negotiation, so that when political conditions improve there is machinery ready to use.

SAARC's institutions have not been dissolved. The Secretariat in Kathmandu, the SAARC Development Fund in Thimphu, the South Asian University in New Delhi, the Food Bank and the Seed Bank all still formally exist. What lapsed was the political direction that gives them work.

Why the size gap is an argument for SAARC, not against it

The intuitive reading of the table above is that a bloc where one member holds three-quarters of the people and four-fifths of the output cannot be a partnership of equals. The counter-argument, and the one that matters most to Malé, runs the other way.

Bilaterally, the Maldives negotiates alone with a partner 2,730 times its size, on that partner's terms, issue by issue. In a chartered multilateral body where Article X gives every member the same procedural standing regardless of size, the smallest state has a formal veto and a seat at the same table. That is not a theoretical benefit — it is the same logic the Maldives already relies on in the Small Island Developing States grouping and in climate negotiations, where its influence is derived from collective structure rather than national weight.

The region's competitive position points the same way. On tariffs, shipping and aviation rules, digital regulation, climate finance and pharmaceutical supply, South Asian states currently negotiate individually with far larger counterparties. Eight separate approaches to the same set of external partners is not competition between South Asian states so much as a discount offered to everyone else.

Whether the Maldives can realistically do this

The case for Malé as a facilitator rests on three things that are verifiable rather than rhetorical.

It is not a party to the disputes. The Maldives has no live territorial, water or security dispute with any SAARC member. It is small enough that its involvement threatens no one's position.

It has done the job before. The Maldives hosted the 3rd SAARC Summit in 1990 and the 17th Summit at Addu in November 2011, themed "Building Bridges," which produced four agreements — including the SAARC Agreement on Rapid Response to Natural Disasters and the SAARC Seed Bank. That summit is a working precedent for a small state convening the region and producing signed instruments.

Its foreign policy is already multilateral in practice. The President cited eleven OIC engagements at various levels over the past two years and the country's standing role among Small Island Developing States.

The limits should be stated as plainly. The Maldives cannot change the calculus between New Delhi and Islamabad; the value of its offer is procedural, not substantive. There is also an unresolved technical knot: the 19th Summit was allocated to Pakistan and never held, so any restart has to settle the hosting question before it settles anything else. And a realistic first step is almost certainly not a summit — it is the resumption of the Council of Ministers or the Standing Committee, the levels at which agendas are actually built.

The last time South Asian leaders gathered for a SAARC Summit was nearly 12 years ago, at the 18th Summit held in Kathmandu, Nepal, in November 2014. For the region to move forward and revive SAARC—and to finally realize the vast economic, technological, and strategic benefits left on the table—member states must set aside their deep-seated political differences and bilateral difficulties to unlock South Asia's true potential. Small as the Maldives may be in geography and population, Malé remains steadfast in its resolve and will continue its diplomatic efforts to bridge these divides and champion the resumption of regional dialogue.