Saarc trade experts meet tomorrow to settle Safta issues
Tariff, rules of origin on agenda
Staff Correspondent
Trade experts from seven South Asian nations meet in Dhaka tomorrow in a bid to narrow the gap in some crucial trade issues like tariff and rules of origin that they need to settle for establishing a free trade area by 2006.Officials from the ministries of commerce and foreign affairs, Tariff Commission and National Board of Revenue will represent Bangladesh at the three-day meeting to discuss the issues with equivalent officials of other Saarc countries. According to sources, Bangladesh has prepared a negative list of 1,398 items out of the total 5,226 to keep them out of the free trade deal but the list may be curtailed as other South Asian countries made comparatively smaller negative lists. A negative list includes the products that would not enjoy zero tariff facility under a free trade agreement (FTA), now being negotiated by the members of the South Asian Association for Regional Co-operation (Saarc). Saarc foreign ministers at the 12th summit of the regional forum in Islamabad early this year signed a landmark agreement to establish South Asian Free Trade Area (Safta) for better economic co-operation among the South Asian nations. "It is not possible for Bangladesh to agree on issues that may cause substantial revenue loss for us," said a commerce ministry official when asked about the negative and positive lists of items prepared for the free trade regime. About the issue of rules of origin under the deal, he said Bangladesh is in favour of 30 percent local value addition in case of exporting its products to other South Asian markets while India is preferring at least 40 percent value addition. The Safta will be effective from January 1, 2006 with greater economic integration of Saarc countries -- Bangladesh, Bhutan, India, the Maldives, Nepal, Pakistan and India -- a market of about 150 crore people. Bangladesh has substantial trade deficit with almost all the Saarc countries including India, Pakistan, Sri Lanka, Nepal and Bhutan. India exported goods worth US$1.1 billion in 2001-02 financial year to Bangladesh while imported products amounting to only $50 million from the country. The trade deficit stood at $590 million in the first six months of FY03. Bangladesh imported goods worth US$68.68 million from Pakistan in 2002-03 while its exports amounted to $31.5 million showing a trade deficit of $38.4 million. Imports from Sri Lanka in 2002-03 totalled $8 million as against exports worth $3.75 million, according to Export Promotion Bureau statistics.
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