The Daily Star
No trade negotiation before Safta implementation - Commerce secretary tells CPD dialogue
Tuesday January 04 2005
The government will not move ahead with trade negotiations with any party before the South Asian Free Trade Area (Safta) gets implemented on January 1, 2006.
At present, Safta tops government’s priority list and the incoming South Asian Association for Regional Cooperation (Saarc) summit in Dhaka may provide further breakthrough in Safta negotiations, scheduled to be concluded by May 31, 2005, Commerce Secretary Md Aminur Rahman said yesterday in Dhaka.
The government will pursue bilateral, regional and multilateral trade deals and aggressive negotiations in the platform after implementation of Safta, he disclosed at a dialogue on "Regionalism vs Multilateralism: What Could Bangladesh Learn from the Global Experience" organised by Centre for Policy Dialogue (CPD).
The government official’s comment erupted a debate at the dialogue at CIRDAP auditorium where most of the economists, business representatives and participants recommended pursuing aggressive negotiations on bilateral free trade deals.
They said under Safta arrangement, Bangladesh may get full duty free market access to India in 2013 whereas under India-Asean partnership Myanmar, Vietnam may get the duty free facility to India in 2010.
Even being the closest neighbour and a fellow Saarc member, India is not ready to provide Bangladesh with duty free market access facility before the four LDCs from Association of Southeast Asian Nations (Asean), they said.
Chairing the dialogue, CPD Chairman Professor Rehman Sobhan said, if Bangladesh does not continue negotiations vigorously the country may lose out to Vietnam, Myanmar, Laos and Cambodia, the four LDCs in Asean bloc, to get duty free access to Indian market.
Former diplomat and President of Bangladesh Enterprise Institute Farooq Sobhan said, "We should start immediate diplomatic efforts to get duty free access to India."
India has signed bilateral free trade agreements (FTAs) with Sri Lanka and Nepal and is negotiating with Thailand over FTA, even though it is a participant in Safta and Bay of Bengal Initiative for Multi-sector Technical and Economic Cooperation (Bimstec), he added.
Bangladesh should negotiate with Saarc countries for on-arrival visa and uniformity in standard requirements, a major non-tariff barrier in intra-regional trade, he said.
Md Fozlul Hoque, president of Bangladesh Knitwear Manufacturers and Exporters Association said apart from FTA with India, the government should reach a trade arrangement with China as the two giant economies offer huge market for Bangladeshi goods.
"If we do not move ahead with trade negotiations with China and India, Vietnam and Cambodia may grab the two huge consumer markets," he said.
Former commerce minister and opposition Awami League leader Tofail Ahmed said, the finance minister made the comment making a U-turn on bilateral FTA with India.
"Sri Lanka and Nepal have signed bilateral FTAs with India and they are seeing growth in export and GDP. We can see huge export growth if we sign FTA with India," he said.
He said, Bangladesh also lacks expertise in trade negotiations. Frequent transfers of key commerce ministry officials in political considerations have created the shortage of expertise, he said.
Commerce Minister Altaf Hossain Choudhury said, the government is committed to multilateral trading system and at the same time it attaches importance to regional and bilateral trade.
Persistent slow pace of multilateral trade negotiations has led to proliferation in bilateral and regional free trade agreements. Presently there are over 300 such agreements in force or in final stage of negotiations and by the end of 2005, 55 percent of the world trade will be covered by such preferential arrangements, he said.
Gaddam Dharmendra, counsellor (political) of Indian High Commission in Dhaka, said it is India that insisted FTA with Bangladesh.
Bangladesh prefers regional and multilateral trade deals while India prefers bilateral trade deals.
Willem van der Geest, director of European Institute for Asian Studies, Brussels, presented a paper on the arranged dialogue.
Among others, Anne Marshal, first secretary of EU delegation to Bangladesh, Alamgir Faruk Chowdhury, former commerce secretary, Sayeeful Islam, president of Dhaka Chamber of Commerce and Industry, Abu Ahmed of Dhaka University, and A Rouf Chowdhury, director of FBCCI, spoke at the dialogue.