Bangladesh is going to experience a boost in its trading as seven-country regional organisation BIMSTEC will sit for the final negotiation of Free Trade Agreement (FTA).
“It is long due. This initiative will ensure a boost to the regional trade,” Foreign Secretary M Shahidul Haque told the Dhaka Tribune.
Bangladesh has already got preferential market access to India and after completion of the negotiation, it will get more preferential market access to Thailand, Sri Lanka and other member countries, he said.
BIMSTEC, a regional body, is comprised of Bangladesh, India, Myanmar, Sri Lanka, Thailand, Nepal and Bhutan.
India under SAFTA arrangement provided duty-free market access to all Bangladeshi products except 25 from 2011.
Thailand and Sri Lanka are big market and when Bangladeshi products will have preferential market access under zero or reduced tariff, the export of the country will increase, Shahidul continued.
Another official of the foreign ministry seeking anonymity said the three-day final negotiation to conclude FTA will begin from Monday in Thailand.
“We will discuss when the FTA will be signed and from when tariff elimination and reduction will take place,” he said.
It is more or less consensus among the countries that the FTA would take effect from early next year, possibly from February, he added.
About the tariff elimination and reduction, he said: “All the countries in 2011 agreed to make it effective from July of 2012 but it could have not happened due to some procedural matters.”
One of the member countries did not provide negative list, an essential component of the agreement, for the last four years and owing to the move, it could not move forward.
“The country has already submitted the negative list and now all the countries agreed to implement FTA as soon as possible,” the official said.
There are about 5,600 products under six-digit harmonized system code and the tariff for the goods would be eliminated under four modalities.
The official said the member countries agreed in 2011 that India, Sri Lank and Thailand would eliminate tariff by 10% on the products by June in 2015 and another 48 percent by June in 2018.
They also agreed to reduce tariff for 19% of products by June 2018 while the rest 23% products will be included to the negative list.
“If it was not materialised in the final negotiation, we will have to fix a new deadline to implement the modalities,” he said.
The member countries need to sign four instruments to implement BIMSTEC FTA.
The instruments are framework agreement on free trade area, protocol to amend the framework agreement, agreement on dispute settlement and agreement on cooperation and mutual assistance in customs matters.
“The texts of the instruments are final and now we have to negotiate when it will be signed and the schedule to implement the four modalities,” the official said.
