"There is enormous potential if we can overcome problems of trade, problems of security and problems of democracy", he said in an interview to NDTV.

Lamenting the lack of trade among the member countries of the regional formation, Boucher, who is attending the SAARC as an observer, said, "if you look at the World Bank numbers on Inter-Regional trade, this region does not really trade with itself."

There is immense scope for Free Trade Agreements and if that can be made to work, enormous economic benefits could accrue to the people of the region, he said.

Highlighting the importance of closer ties among the members, he said, "there lie strategic benefits through trade, political interactions and meetings like SAARC."

Clarifying US position vis-a-vis regional organisations like SAARC, boucher said, "We need to look for ways on working regionally with countries the way we work with them individually."

When asked how US intended to iron out the inconsistencies that dogged SAARC, he said,"we have very strong programmes for these countries in fighting terrorism, poverty alleviation and economic reforms."

Underlining the relevance of SAARC in facilitating dialogue between the US and the constituent countries, he said," SAARC offers a chance to work with them as a group and the things they have been doing as a group."

"We have been involved already with them (SAARC) in free trade discussions, trying to help them with expertise and look for other areas like trade and education," he said.