EU tariff concessions to PakistanBD examining options asIndia changes position

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Syful IslamBangladesh is examining the policy options to deal with the situation emerging out of India's changed position regarding the European Union's (EU's) offer of tariff concessions to Pakistan, a senior trade official said Tuesday. India late last month announced that it would drop its objections, lodged earlier with the World Trade Organisation (WTO) against trade concessions which the EU promised to Pakistan as part of its assistance package to help Islamabad recover from the devastation of the 2010 floods. The EU promised to reduce tariffs on 75 Pakistani goods for a period of three years, including 67 items which will enjoy zero duty facilities while entering its markets. India raised objection to the WTO so that its goods do not face uneven competition while entering the EU market. India and Pakistan are both categorised as developing countries and none of their goods enjoys tariff concession of the EU. The EU only offers tariff preference to goods of the least developed countries (LDCs). Bangladesh also raised objection to EU's tariff concession offer to Pakistan, especially on eight apparel items, export of which may be hit hard following the decision. Currently, Pakistan exports goods worth U$1.2 billion to the EU which may increase by some $136 million due to the tariff concessions. Sources said Bangladesh and EU officials will sit together late next month to review the existing trade relations among them. Such review takes place once in two years. During the meeting, Dhaka may raise the issue again which it raised to the WTO after EU announced tariff concession to Pakistan. Sources said the ministry of commerce (MoC) recently asked the Bangladesh embassies in Switzerland and Belgium to inform it about the latest position regarding the EU's tariff concession offer to Pakistan. Bangladesh diplomats earlier informed the MoC that the tariff concession would be valid for two years, instead of originally announced three years. They also informed the Bangladesh side that six products from its reserve list of eight are now covered under the tariff-rated quota of the EU. "We have sought an update from our diplomats in Switzerland and Belgium about the tariff concession by the EU to Pakistan. We will formulate strategies with their input," said a senior official of the MoC. The EU is the largest destination of Bangladeshi exports. The main items Bangladesh exports to the EU are readymade garments, frozen food, leather, jute and tea. Most of the Bangladeshi goods enjoy zero-duty facility to the EU market under its 'Everything But Arms' scheme.