Pakistan mulls more imports from Lanka

Pakistan which is Sri Lanka's second largest trade partner in the SAARC region is eager to increase imports from Sri Lanka this year.

"Pakistan's new GSP with the EU is an opportunity for Sri Lankan exporters. We should jointly explore whatever is possible within the rules and regulations of the new developments," said Pakistan High Commissioner to Sri Lanka, Major General Qasim Qureshi when he paid a courtesy call on Industry and Commerce Minister Rishad Bathiudeen at the Ministry premises.

"We believe that there is strong unrealised trade potential between both countries.

"Through the Joint Economic Commission, we annually review the progress of our FTA so that it becomes increasingly 'commerce-friendly' for both countries," he said.

"There is a trade imbalance between Pakistan and Sri Lanka and we hope to reduce that.

"This means that we should also explore avenues through which more products from Sri Lanka could be exported to Pakistan," Qureshi said.

"We hope to expand bilateral trade from the annual level of $ 440 million to $ 1 billion in the coming years - perhaps even in a couple of years by looking at new products. Pakistan's new GSP with EU is an opportunity for Sri Lankan exporters," he said.

For example, Sri Lankan exporters can consider more raw material exports to Pakistani industries that manufacture for the EU market using GSP. In fact, we should jointly explore whatever is possible within the rules and regulations of the new developments," Qureshi said.

According to Commerce Department sources, Pakistan is the second largest trading partner of Sri Lanka in the SAARC region after India. Lankan exports to Pakistan topped $ 42.97 million from January to June in 2013 and more importantly, registered a 27% surge from $ 60.38 million in 2010 to $ 82.75 million by 2012.

A substantial growth in bilateral trade is seen in exports and imports after the Free Trade Agreement between the two countries was implemented in 2005. Trade has increased from US $ 158 million in 2005 to US $. 433.69 million in 2012 (and from January to June 2013 - $289.23 million). The balance of trade has always been in favour of Pakistan.

"We are also exploring the possibility of getting new investments from Pakistan to Sri Lanka because we think that it is not only just commerce but mutual investments too can strengthen bilateral economic relations. We are also exploring the possibility of bringing in investments from Pakistan to Sri Lanka and are focusing on the sugar industry in Sri Lanka," Qureshi said.

Sri Lanka spends around $ 60 million on sugar imports annually and sugar worth $ 3.38 million was imported from Pakistan in 2012. As for Pakistani investment in Sri Lanka, from 2005 to the third quarter of 2013, FDI from Pakistan to Sri Lanka stood at $ 7.5 million (cumulative) across 15 investment projects.

In November 2013, when the President of the Pakistan-Sri Lanka Business Forum (PSLBF), Tarek M. Khan met Minister Bathiudeen in Colombo, he said that Pakistani investors have a preference for Sri Lanka due to logistics and rapidly developing infrastructure.

Minister Bathiudeen said, "I believe that we should maximise all opportunities presented by our FTA and enhance bilateral trade. Our exporters are already leveraging the PSFTA and it is time our exporters try on new products since there are more than 4,800 product lines available to them under the PSFTA."