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India hosts meeting of SCO Ministers handling economy and foreign trade.

Focus:  GS 2 ; Bilateral, regional and global groupings and agreements involving India and/or affecting India’s interests.  

Why in News?

India  hosted the 19th Meeting of the Shanghai Cooperation Organisation (SCO) Ministers responsible for Foreign Economy and Foreign Trade Activities. 

The Minister of Commerce and Industry Shri Piyush Goyal said that the current crisis due to Covid-19 is a clarion call to the SCO countries to leverage the economic strength and explore partnerships that enhance trade and investment in the region.  

India underlined the necessity to enhance intra SCO trade and investment to ensure speedy recovery 

About Shanghai Cooperation Organization (SCO);-

  • It is a permanent intergovernmental international organization.
  • It’s creation was announced on 15 June 2001 in Shanghai (China) by the Republic of Kazakhstan, the People’s Republic of China, the Kyrgyz Republic, the Russian Federation, the Republic of Tajikistan, and the Republic of Uzbekistan.
  • It was preceded by the Shanghai Five mechanism.
  • The Shanghai Cooperation Organisation Charter was signed during the St. Petersburg SCO Heads of State meeting in June 2002, and entered into force on 19 September 2003.
  • The SCO’s official languages are Russian and Chinese.
  • Its membership was expanded to include India and Pakistan in 2017.
  • The SCO also has four observer states i.e. Afghanistan, Iran, Belarus and Mongolia,  which may be inducted at a later date.
  • The SCO Hq in Beijing, China.
Shanghai Cooperation Organisation (SCO) - INSIGHTSIAS

Above Image includes all the SCO members.

Organizational Structure of SCO;-

  • The organization has two permanent bodies i.e. the SCO Secretariat based in Beijing and the Executive Committee of the Regional Anti-Terrorist Structure (RATS) based in Tashkent. 
  • The SCO Secretary-General and the Director of the Executive Committee of the SCO RATS are appointed by the Council of Heads of State for a term of three years. 
  • However, the venue of the SCO council meetings moves between the eight members.
  • SCO has the capacity to counterbalance North Atlantic Treaty Organization (NATO), therefore, it is sometimes considered as “alliance of the East”, i.e, the Eastern complementary of NATO.
Member states 
Observer states 
Member states 
Dialogue partners 
Sri Lanka 
Guest attendances 

The SCO’s main goals are as follows:-

  • Strengthening mutual trust and neighborliness among the member states.
  • Promoting their effective cooperation in politics, trade, the economy, research, technology and culture, as well as in education, energy, transport, tourism, environmental protection, and other areas.
  • Making joint efforts to maintain and ensure peace, security and stability in the region and moving towards the establishment of a democratic, fair and rational new international political and economic order.

Significance for India in SCO;-

Historical Significance:-India has always been seen as a friendly territory to countries that formed part of the erstwhile USSR.

  • India since the past has invested in these countries, but due to lack of accessibility, India’s connection to these countries was restricted.
  • Also, these countries have apprehensions regarding the growing dominating role of Russia and China. Hence, in light of these developments, India can play a key role in the region.

Diplomatic Ties:-SCO provides a platform to exchange ideas with world leaders like Russia. Hence, India looks for positive engagement with member nations of this organization.

Military:-SCO’s joint military exercises, Regional Anti-Terrorist Structure (RATS is a structural institution that focuses on terrorism a common threat affecting nations) inter alia, are significant to India. 

  • India can rally down the neighbouring countries acting as the hub of terrorism at these platforms.
  • The main functions of SCO-RATS are coordination and information sharing. As a member nation, India has actively participated in its activities.

Connectivity:- Through this forum, India can seek another route to Eurasia and Central Asia.

Economic Factor:- Through this platform, new markets could be explored by India for selling Indian goods and tapping foreign resources, thereby benefiting the Indian industries (which are already facing the brunt of economic slowdown due to pandemic).

Challenges for India in SCO;-

Developmental cooperation- It including large-scale projects like telecommunication, infrastructure connectivity, etc. between the associated nations is neutral and can be continued. However, energy concerns pose a serious challenge that demands India’s urgent attention in the prevailing political turmoil between the USA ,Iran and Iraq.

Regional Influence:- In lieu of close relations between Russia and China or China-Pakistan (due to China Pakistan Economic Corridor (CPEC), Belt Road Initiative), India needs to manage its association and tensions with China so as to peacefully maintain the economic, territorial and cultural relations.

Accessibility:- According to Mackinder’s Theory of Heartland, “the core of global influence lies in the area known as the Heartland- a region of the world situated in Eurasia (due to its sheer size, a wealth of resources, and huge population).”

Mackinder stated that the nation in control of the Heartland had the potential to “command the world”, but at the same time, also highlighted the great natural barriers which surrounded the Heartland.

India faces a challenge in harnessing and getting access to the Eurasian heartland because of prevailing geopolitical tensions in the concerned region.


Geopolitical Concerns:– According to Spykman’s Rimland Theory, the coastal areas or littorals of Eurasia are vital in controlling the World and not the Heartland.

In the light of this theory, the rimland nations like Pakistan and Iran, therefore, play a major role in restricting India’s growing hegemony in the region.

Also, how India manages a balance between these two theories will determine India’s leading role in the Indo-Pacific and Indian Ocean region.


The following several areas where India can enhance its opportunities they are as follows;-

Military:- China sees itself as a hegemonic power which wants to create a China-centric global order. 

India needs to contain this asymmetric power balance by building friendly relations with other countries, strengthening its defence capabilities, and managing the territorial disputes with China in a peaceful way.

Economic:- India also needs to foster & expand its economic engagement with China. Traditionally, the demands of Western China including Xinjiang province were once fulfilled by India.

For instance, until the 1960s, India supplied food grains to Tibet.

Therefore, by opening new avenues for accessing Chinese resources, India could balance its current trade deficit with China in a better way.

Ideologically:- As now the ideological war between Communist China and Democratic India is over, the only prevailing border disputes could be effectively managed by continuous bilateral dialogues.

In this regard, India’s soft power could be harnessed so as to end the mysterious perception that is prevalent in the hinterland areas of China regarding India’s aura.

Russia’s Angle:- India needs to allay Russian fears in the lieu of growing Indo-American ties. Russia holds a significant position for India be it historically, culturally, diplomatically or militarily. Therefore, India needs to increase its engagement with Russia through bilateral and multi-fora dialogues like on the sidelines of SCO.

July 2024