Uncertainty looms over Bangla-Pak FTA talks

Daily Star, Dhaka

Uncertainty looms over Bangla-Pak FTA talks

Md Hasan

29 August 2006

Although Bangladesh and Pakistan have agreed to sign a free trade area deal by September this year, the two countries are yet to start negotiations.

"Pakistan recently proposed to Bangladesh to ink a FTA deal. But no discussion was held on the issue at government level," said a high official of the commerce ministry.

He said, "Our main problem is that we have not yet received the government’s nod to conduct negotiations on FTA. The commerce ministry has placed a summary to the cabinet division for a decision. But the issue has not been included in the agenda".

In absence of a clear signal from the government, it is difficult to resume FTA negotiation with Pakistan, he added.

In tune with the experts’ opinion, the commerce minister, Hafizuddin Ahmed, also said he cannot say anything at the moment about the signing of the deal as the matter is still under the consideration of the government.

"The FTA issue was discussed between Bangladesh and Pakistan governments before my take-over in the commerce ministry. So at this moment, I cannot say whether the deal will be signed within the timeframe committed by the high-ups of both the governments," said Hafizuddin after a meeting with the delegation of Federation of Pakistan Chambers of Commerce and Industry yesterday.

He, however, said, "The Safta (South Asian Free Trade Area) implementation process is facing problems. Multilateral arrangement may not be very suitable for some countries. So, as an alternative way, only bilateral deal can bring about mutual benefits for a country".

He informed that the FTA is under scrutiny adding ’as Pakistan is in favour of trading with Bangladesh, we like to make such a deal so that the trade gap reduces.’

The two countries agreed to go for the FTA during Prime Minister Khaleda Zia’s visit to Pakistan in February this year. The two sides at that time also agreed to finalise the deal latest by September 30, 2006.

Meanwhile, while talking to The Daily Star, some officials of the commerce ministry also hinted at looming uncertainty over finalisation of the free trade deal during the tenure of this government.

The sources said," There are so many things to be settled before reaching bilateral deals like tariff barriers, rules or origin, sensitive list and so on. So, how can we think, the FTA deal will be finalised within a month".

For example, he said, as per the Pakistan FTA proposal, it is expected that duties on most goods will be eliminated. But this is unlikely to happen. The proposed FTA does not indicate the pace and the extent of tariff reduction, the sources added.

The officials stressed the need for squeezing the sensitive lists by both the sides.

They said, "This kind of protective sentiments, which is not always unjustified, will delay signing the FTA between the two countries as it happened in Safta.

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