“Whereas an preliminary spherical of inputs was submitted by the business when the negotiations resumed late final yr, now that the 2 sides have made progress and are negotiating on particulars together with on guidelines of origin, you will need to take the business’s views earlier than finalising commitments. That’s the reason extra inputs have been sought,” the official mentioned.
Following go to of Sri Lankan President Ranil Wickremesinghe to India in July final yr and the choice of each the nations to renew talks on the ETCA (that have been stalled in 2018 after two years of negotiations), India and Sri Lanka re-started the negotiations in Colombo on October 30, 2023.
Colombo additionally hopes that the pact with India would assist in its efforts to take care of the financial disaster it has been grappling with for the reason that Covid-19 pandemic devastated its financial system.
Bilateral FTA
The India-Sri Lanka ETCA seeks to construct upon the bilateral FTA signed in 2000 which already helped Sri Lanka in rising its exports to India in a number of key commodities. The proposed ETCA has varied chapters together with commerce in items, commerce in providers, technical obstacles to commerce, sanitary and phytosanitary measures, guidelines of origin, customs process & commerce facilitation, commerce treatments, financial and technological cooperation and dispute settlement. It additionally seeks to remove non-tariff obstacles and allow larger commerce facilitation.
India hopes the ETCA will assist it acquire larger market entry in gadgets reminiscent of vehicles, auto components, prescribed drugs, sure textile merchandise, chemical compounds in addition to varied providers. Furthermore, analysis by some business our bodies recommend that Sri Lanka might change into a major a part of the Indian provide chain enabling Indian producers to arrange factories within the nation to fabricate and export merchandise to nations with which Sri Lanka has or is planning to have Free Commerce Agreements.
“The Commerce Division has requested varied business sectors to look at the proposed guidelines of origin (that decide how a lot worth addition is required for a product to be eligible for preferential tariff advantages) to see if there’s a want of product particular guidelines (flexibilities) to both grant them extra entry within the Sri Lankan market or defend the home business. It is rather essential to be exact within the calls for put ahead,” the official mentioned.
India and Sri Lanka are additionally weighing the calls for made by either side by way of implementation points flowing from the India-Sri Lanka FTA. These embrace elimination of import quotas on sure commodities, SPS notifications on dairy, market entry for automobiles and sure points on motion of pros.
In 2023-24, India’s exports to Sri Lanka have been valued at $4.11 billion whereas its imports have been at $1.42 billion, per authorities knowledge.
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