The South Asia Free Trade Agreement (SAFTA) was agreed to among the seven South Asia countries that form the South Asian Association for Regional Cooperation (SAARC): Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan and Sri Lanka
SAFTA came into effect on 1 January 2006, with the aim of reducing tarrifs for intraregional trade among the seven SAARC members. Pakistan and India are to complete implementation by 2012, Sri Lanka by 2013 and Bangladesh, Bhutan, Maldives and Nepal by 2015.
SAFTA replaces the earlier South Asia Preferential Trade Agreement (SAPTA) and may eventually lead to a full-fledged South Asia Economic Union.
The road to implementation, however, is plagued by the overarching conflict between India and Pakistan.
last update: May 2012
Photo: Serg!o/Wikipedia/CC BY-SA 3.0
Sri Lanka’s second largest trade partner in SAARC, Pakistan, is hungry for more Lankan exports in the coming year-while also closely looking at Sri Lanka’s sugar sector for entry.
No assurance was given by the Pakistan government on Tuesday for granting India the Most Favoured Nation trade status, almost a year after it missed the deadline to do so in order to normalise bilateral trading relations.
Promotion of trade among SAARC countries is one of the top priorities of the government, said Federal Minister for Finance Senator Mohammad Ishaq Dar talking to Air Chief Marshal Jayalath Weerakkody High Commissioner of Sri Lanka.
Chief Executive Officer (CEO) Harvest Tradings Ahmed Jawad has said that to boost the trade with the neighbouring country the government needed to review the Pak-India trade agreement. Talking to INP here on Sunday, Ahmed Jawad said that there was no other option than enhancing trade to normalise the bilateral political and diplomatic relations with India.
The South Asia Free Trade Agreement (Safta) appears to be a ‘disaster’ for Pakistan’s agricultural sector and is backed only by the industrial lobby.
The Most Favoured Nation status to Pakistan could not prove instrumental in increasing agriculture exports to India, observed a report sponsored by the United States Agency for International Development (USAID).
There are several safeguarding measures under WTO regime to save industry even after normalisation of trade with India, as delay in this regard will jeopardise the process of liberalisation of trade between the two neighbours.
Bilateral trade between Bangladesh and India rose nearly 20 per cent to more than US$ 4.50 billion in the fiscal year (FY) 2011-12 following reduction of sensitive lists by the relevant authorities in both the countries in late 2011.
Businessmen and traders of Pakistan and India have agreed that infrastructure bottlenecks are hindering the growth in trade relations between the two sides and these should be removed to deepen the ties.
The decision taken by Pakistan and India to scale down tariff to a maximum of 5% and remove all non-tariff barriers (NTBs) by 2020 will lead to regional integration, according to an official of the Geneva-based World Trade Organisation (WTO).
The South Asian Association for Regional Cooperation (SAARC) comprises the seven South Asian countries of Bangladesh, Bhutan, India, the Maldives, Nepal, Pakistan and Sri Lanka