SAFTA meet to discuss sensitive goods' list, NTBs

By A Staff Reporter
KATHMANDU, Feb 25: The second meeting of the SAFTA Ministerial Council is beginning in Kathmandu on Monday.

The Commerce Ministers from the South Asian nations have started arriving in the capital to take part in the meeting that, according to the sources at the Ministry of Industry Commerce and Supplies (MoICS), will discuss on various agenda including the issue of sensitive goods' list, non-tariff barriers (NTBs) and Dispute Settlement Mechanism (DSM).

The ministerial meeting is preceded by a two-day meeting of the Committee of Experts (CoE) that began from February 24. The joint secretary level meet will present its recommendation to the Ministerial Council, the MoICS sources said.

SAFTA came into effect on January 1, 2006 with the aim of reducing tariff for enhancing trade among the seven SAARC member states. Pakistan and India are to complete implementation of the agreement by 2012, Sri Lanka by 2013 and Bangladesh, Bhutan, Maldives and Nepal by 2015.

The Agreement on the South Asian Free Trade Area (SAFTA) was reached at the 12th South Asian Association for Regional Cooperation (SAARC) summit held in Islamabad, capital of Pakistan on 6 January 2004. It is a framework for the creation of a free trade zone covering 1.4 billion people in the region.

The seven foreign ministers of the region signed a framework agreement on SAFTA with zero customs duty on the trade of practically all products in the region by the end 2012. The SAARC Preferential Trading Arrangement (SAPTA), with concessional duty on sub-continent trade, went into force on January 1, 1996.

SAFTA requires India, Pakistan and Sri Lanka, to bring their duties down to 20 per cent in the first phase of the two-year period ending in 2007. In the final five year phase ending 2012, the 20 per cent duty will be reduced to zero in a series of annual cuts.

The least developed country group in South Asia consisting of Nepal, Bhutan, Bangladesh and Maldives will get an additional three years to reach zero duty.

The effective implementation of SAFTA, according to experts will determine the larger success of SAARC. They maintain that for SAFTA to exploit its true potential, it will have to be widened to cover, apart from 'free movement of goods', investments and services.