Stalled negotiations on FTA among BIMSTEC states resume today

FE Team | Published: September 24, 2007 00:00:00 | Updated: February 01, 2018 00:00:00

FE Report
The trade negotiation committee (TNC) is sitting again in Dhaka today (Monday) to move forward the negotiation process for forming a free trade bloc under the BIMSTEC umbrella.
The resumption of trade negotiation indicates that the regional leadership has decided again to go ahead with the free trade agreement (FTA) among the BIMSTEC member countries.
The move for a free trade zone, however, was apparently stalled last year following the political changeover in Thailand and subsequent political changes in Bangladesh.
"We will discuss different crucial issues related to rules of origin (ROO) and tariff measures of the member countries under the BIMSTEC umbrella. I hope the trade negotiation in Dhaka will push forward the entire process one step ahead, towards forming a regional economic zone," a senior official of the Bangladesh Tariff Commission told the FE Sunday.
At the three-day meeting, the negotiators will try to iron out issues related to rules of origin (ROO), negative lists of products of individual member states, local value addition content of exportable products, customs formalities and arbitration modalities.
Commerce secretary Feroz Ahmed will open the first session of the trade negotiating committee at a local hotel in the city today (Monday) morning.
The BIMSTEC was formed comprising seven South-East Asian countries include Bangladesh, Myanmar, India, Sri Lanka, Thailand, Nepal and Bhutan to strengthen trade and investment among its member countries.
The FTA under the BIMSTEC is to be implemented in two phases under the original scheme of things, with the least developed countries (LDCs) - Bangladesh, Myanmar, Nepal and Bhutan - getting the benefit of a grace period in both phases.
Under the fast track, products listed by a party on its own accord will have their respective applied most favoured nation (MFN) tariff rates to be gradually reduced or eliminated in accordance with specified rates to be mutually agreed upon, by the parties, within a time frame.
Under the fast track, India, Sri Lanka and Thailand were scheduled to reduce duties on identified items between July 1, 2006-June 30, 2009 for developing countries and July 1, 2006-June 30, 2009 for the LDC countries.
Bangladesh, Myanmar, Bhutan and Nepal will have to reduce duties for goods under the fast track by June 30, 2011 for developing countries and June 30, 2009 for LDC members.
Products listed in the normal track by a party on its own accord will have their respective applied MFN tariff rates to be gradually reduced or eliminated in accordance with specified rates to be mutually agreed upon, by the parties, within a time frame.

The time-frame for tariff elimination for India, Sri Lanka and Thailand for products under the normal track was scheduled for the period between July 1, 2007 to June 30, 2012 for the developing countries and until June 30, 2010 for the LDCs.
For Bangladesh, Myanmar, Bhutan and Nepal, the time limit is July 1, 2017 for the developing countries and June 30, 2015 for the LDCs.
BIMSTEC provides a unique link between South Asia and Southeast Asia, bringing together 1.3 billion people - 21 per cent of the world population, a combined GDP of US$750 billion, and a considerable amount of complementarities.
A study shows the potential for trade creation, valued at, between US$ 43 billion and $59 billion under the BIMSTEC FTA.