Exports to SAARC region to hit $ 1,000 m by 2015

by Lalin FERNANDOPULLE

Exports to the SAARC region will top $ 1005.95 million in 2015, trade experts said. Intra-SAARC exports would cross $ 17,500 million by 2015, they said.

Exports under South Asian Free Trade Area (SAFTA) preferential tariff schemes last year stood at $ 1.5 billion. According to an Asian Development Bank (ADB) study, SAFTA trade could be increased to US$ 85 billion from the current level of $ 10 billion. According to IMF statistical trends of 1996-2008 Sri Lanka’s exports to the SAARC region will top $ 1005.95 Mn in 2015.

Total Intra-SAARC exports are expected to cross the $ 17,500 million mark by 2015.

Sri Lanka will meet the highest decision-makers of SAARC Trade on Thursday for the latest round of consensus on trade aspects among member countries, Ministry of Industry and Commerce sources said.

The Ministerial Council meeting of the South Asian Free Trade Area (SAFTA) was held on Thursday in Islamabad, where Commerce Ministers of member countries - Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan, Afghanistan and Sri Lanka discussed promotion of trade in goods and services within the SAARC Region.This is the sixth SAFTA Ministerial Council (SMC) meeting to be held under the SAFTA framework.

The SMC is the highest decision-making body of SAFTA.

The sixth meeting of the SAFTA Ministerial Council in Islamabad will discuss matters relating to the administration and implementation of the SAFTA agreement and also trade in services under the SAFTA framework. The sessions of the Ninth Meeting of the Expert Group on SAARCAgreement on Trade in Services were held on February 13. The meeting discussed the role of services of specific member countries in their trade promotion efforts within the SAARC Region.

The SAFTA Agreement was signed on January 6, 2004 during the twelfth SAARC Summit in Islamabad, Pakistan.

The Agreement came into force on January 1, 2006, and the Trade Liberalisation Program commenced from July 1, 2006.

Total exports in 2011 under SAFTA preferential tariff schemes stood at $ 1.5 Bn. According to an Asian Development Bank (ADB) study, SAFTA trade could be increased to US$ 85 billion from the current level of $ 10 billion.According to Executive Director of Institute of Policy Studies, Dr Saman Kelegama, SAFTA liberalisation will be of benefit to the SAARC region.

“Further liberalisation under SAFTA will help regional consumers greatly in the form of low cost products and services”, Dr. Kelegama said. “Also, SAFTA needs to work towards liberalisation of intra-regional investment flows so that in turn, trade will be stimulated”, Dr. Kelegama said.

Sri Lanka exports natural rubber, cloves and mace, black tea, cocoa peat, broomsticks, knitted fabric and tyres under SAFTA,.

However, Sri Lanka has substantial bilateral trade volumes with SAARC countries outside the SAFTA agreement.

Most of such trades are under specific bilateral agreements such as Indo – Sri Lanka Free Trade Agreement and Pakistan-Sri Lanka Free Trade Agreement. This is one reason for Sri Lanka’s exports levels to be identified as ‘modest’ with SAFTA.