CEPA to be finalised by end 2006
 

by Surekha Galagoda

The Comprehensive Economic Partnership Agreement (CEPA) between India and Sri Lanka is expected to be finalised by the end of this year.

The CEPA was to be finalised at the end of last year but due to several reasons including implementation issues of the Indo Sri Lanka Free Trade Agreement (FTA) and other issues it got delayed, an official of the Commerce Department said.

The Free Trade Agreement signed between India and Sri Lanka in 1998 and implemented in 2000 spells out the concessions given to goods while the CEPA extends beyond goods to include services, investment and economic cooperation.

The FTA has led to an increase of trade between the two countries and therefore both countries are interested in extending the agreement to include services and investment as well, the official said.

In 2004 August, the initial exchange of views at Commerce secretary level of the two countries were held and up to now seven rounds of technical level negotiations and two rounds of Commerce secretary level negotiations have been held between the relevant officials of the two countries to make the CEPA a reality.

Under CEPA both countries are trying to reduce the negative lists, relax the current rules of origin and introduce product specific rules in relation to about 500 product lines and give mutual recognition for product standards.

Under the category of services banking, insurance and capital markets are being considered initially. At present both countries are making requests and offers .

In the area of investment negotiations are under way.

In relation to economic cooperation Sri Lanka has forwarded a few proposals including the Colombo Matara railway track, IT park and renovation of movie theatres. The two governments are exploring the possibility of closer cooperation in the areas of consumer protection and legal metrology, the spokesman said.

He said that the next session of technical level talks between the officials of the two countries is scheduled to be held in mid June in Colombo.