The Shanghai Cooperation Organization (SCO) was established in 2001 and since then it has been evolving as an influential international organization and has been steadily gaining prominence on the global stage. Its roots go back to 1996 with the ‘Shanghai Five” that included China, Russia, Kazakhstan, Kyrgyzstan, and Tajikistan, with the aim to resolve border disputes and enhance regional security among the member states. With its exemplary success and appeal, in 2001 Uzbekistan joined the organization and was renamed to SCO. The same year, one of the key milestones of the SCO was the signing of the Shanghai Convention on Combating Terrorism, Separatism and Extremism. This landmark agreement laid the foundation for the organization’s counterterrorism efforts, which have become increasingly important in the face of growing regional security challenges. In 2017, Pakistan and India addition to SCO’s full membership made it a total of eight nations organization and its scope was extended to include fostering cooperation in economics, and culture, in addition to security and connectivity. The addition of India and Pakistan also expanded the SCO’s geographic reach, diversity and population significantly.
Another landmark success was the creation of the SCO Development Bank and the SCO Development Fund (Special Account) in 2005 and 2006, respectively. These financial institutions have played a crucial role in promoting economic cooperation and investment among member states, particularly in areas such as infrastructure development and trade facilitation.
Under the cultural and educational exchange domain, creation of SCO University in 2009 was another great milestone. This University facilitate to collaborate with the network of leading universities across the member states aims to foster academic cooperation, student exchange, and knowledge & expertise sharing among the member states, academia, and their research organizations. By looking at SCO’s goals & objectives, clearly it is a complementary organization to BRI and BRICS, the emerging global platforms.
With the SCO’s continued prominence and influence in the developing world, it has often been viewed with suspicion by the West, which sees it as a counterweight to Western-led institutions and alliances.
Overall, the SCO’s evolution has been marked by a steady expansion of its membership and influence, as well as its growing geopolitical significance. Currently, there are three categories of membership:
Full Members: There are eight full member nations that include China, Russia, Kazakhstan, Kyrgyzstan, Tajikistan, Uzbekistan, India, and Pakistan. In July 2024 summit, Belarus was approved for the full membership, thus by now there are nine full member nations.
Observer States: Include Afghanistan, Iran, and Mongolia.
Dialogue Partners: There are six dialogue partners that include Armenia, Azerbaijan, Cambodia, Nepal, Sri Lanka, and Türkiye.
As the SCO has grown in membership, its influence and scope have also expanded significantly. The SCO has placed a strong emphasis on promoting economic cooperation and development among its members. Here are some of the major areas in which the SCO fosters economic collaboration:
SCO Development Bank and Development Fund: Established in 2005 and 2006, respectively are the financial institutions created to support joint investment projects and initiatives among the members, particularly in infrastructure, energy, and transportation.
Trade and Investment Facilitation: The SCO facilitates trade and investment among its member states by harmonizing customs procedures, eliminating trade barriers, and promoting joint business ventures. This includes the establishment of the SCO Business Council and the SCO Interbank Consortium to coordinate economic activities.
Connectivity and Infrastructure Development: The SCO prioritizes the development of regional connectivity and infrastructure, such as highways, railways, ports, and energy pipelines. These projects enhance the flow of goods, services, and resources across the Eurasian region, strengthening economic integration.
Energy Cooperation: The SCO promotes cooperation in the energy sector, including joint oil and gas projects, coordination of energy policies, and the establishment of an SCO Energy Club. This is crucial given the region’s significant energy resources and shared interests in energy security.
Agricultural Cooperation: The SCO fosters cooperation in the agricultural sector through the exchange of best practices, joint research projects, and facilitation of agricultural trade. This enhances food security and rural development in the region.
Digital Economy and Innovation: Recently, the SCO has focused on promoting cooperation in the digital economy and innovation, including the establishment of an SCO Innovation Club and joint digital infrastructure projects.
Overall, the SCO’s economic cooperation initiatives are aimed at creating a more integrated and prosperous Eurasian region, with the goal of enhancing the competitiveness and resilience of its member states in the global economy.
The 24th Summit of the Council of Heads of State of the SCO was held recently (July 3-6) in Astana, Kazakhstan. Following are the main takeaways from the summit:
Commitment to Enhancing Regional Connectivity: SCO member states reaffirmed their commitment to developing transport corridors and infrastructure projects to enhance regional connectivity among the members. This was a central focus of the summit discussions.
Coordination and Harmonization of Policies: Member states agreed to intensify efforts to harmonize regulatory frameworks, customs procedures, and technical standards related to transport corridors, facilitating the seamless movement of goods, services, and people across the region.
Multilateral Financing Mechanisms: The summit strengthened the SCO Development Bank and the SCO Development Fund, which will play a crucial role in providing coordinated financing for transport corridor projects, addressing funding challenges faced by individual member states.
Private Sector Engagement: There was a strong emphasis on engaging the private sector in developing and operating transport corridors. Member states recognized the need to leverage private expertise, resources, and innovative capabilities to ensure the long-term sustainability of these initiatives.
Addressing Geopolitical Tensions: The member states acknowledged the importance of managing and resolving any geopolitical tensions that could undermine the effectiveness of the transport corridor initiatives. Diplomatic efforts and confidence-building measures were discussed as part of the summit agenda.
Alignment with Global Initiatives: The SCO transport corridor projects were reaffirmed as being aligned with and integrated into broader international initiatives, such as the Belt and Road Initiative, the Eurasian Economic Union, and the Trans-European Transport Network. This alignment allows for the harmonization of standards and the optimization of investment strategies.
Emphasis on Multimodal Integration: The member states reiterated their commitment to developing the transport corridors as multimodal networks, combining road, rail, and maritime infrastructure. This is seen as crucial for enhancing the overall efficiency and resilience of regional logistics and supply chains.
Overall, the 2024 SCO summit demonstrated the organization’s continued focus on strengthening regional connectivity through the development of integrated transport corridors, while also addressing the various challenges and opportunities associated with these initiatives.
In conclusion, as the world becomes increasingly multipolar, SCO offers a new model for international cooperation based on mutual respect, trust, equality, inclusivity, and diversity. With these unique blends of characteristics, the SCO is poised to play an increasingly vital role in shaping the geopolitical landscape.
