“I suggest, at this point we can finalize some of the recommendations which can be implemented and the long-term issues we can meet at the CEPA (Comprehensive Economic Partnership Agreement) framework. There need not be many agreements for each issue as the CEPA is a comprehensive document and it can take all the issues”.
These were the remarks made by Shri Manish, Counsellor (Economic, Commercial) High Commission of India in Colombo, at the last session of the day long Conference on Trade Facilitation (TF) Issues Related to the India – Sri Lanka FTA, jointly organized by the Institute of Policy Studies (IPS) of Sri Lanka and UNDP Asia-Pacific Regional Centre, Bangkok, held in Colombo recently.
The objective of the Conference was to discuss the outcomes of a study carried out by the Institute of Policy Studies on TF issues identified by both Sri Lankan and Indian exporters/importers that use the Indo-Lanka FTA and to arrive at possible modalities as to how these measures could be implemented in Sri Lanka based on international best practices.
At the inaugural sessions in the morning, Ashok K. Kantha, Indian High Commissioner in Sri Lanka extensively referred to the CEPA and said that the CEPA provides for a close cooperation mechanism between the Customs authorities and suggested a number of initiatives for transparency of laws, rules and regulations, adoption of risk management techniques to allow expeditious clearance to low risk consignments, paperless trading methods, advance ruling systems etc.
Mr Kantha said that another problem faced by Sri Lankan exporters has been delayed owing to testing and certification requirements for certain products in India. He said that the CEPA provides for a Mutual Recognition Agreement (MRA) as well as adoption of common Sanitary and Phytosanitary (SPS) Standards.
He said that the CEPA provides for redresses through non-governmental means by providing for a dispute resolution mechanism that would be opportune to bring about a qualitative upgrading of commercial and economic ties between India and Sri Lanka and gives four points for his reasoning such as excellent state of bilateral relations and mutual stakes in each other’s prosperity and stability; end of armed conflict and political stability; recovery from global economic crisis as Sri Lanka and India are relatively less affected.
He said that the large and growing Indian markets can provide Sri Lankan companies the economies of scale that allow them to cut costs and become competitive in the global environment. He said that Indian imports would be over $300 billion and Sri Lanka with preferential treatment under the FTA can hope to take a significant share of this ‘cake’.
Mr Kantha stressed “I am aware of some misconceptions about the CEPA which has been under discussion. Let me clarify a few points. When we seek a more comprehensive framework for economic partnership, our principal objective is not to seek preferential market access in Sri Lanka, whether for our goods and services. As in the case of the FTA we in India, would remain cognizant of our responsibility to address the issue of asymmetries in the size of our two economies, so that benefits of such an arrangement are equitable.”
He said that the document could be widely discussed in Sri Lanka by all the stakeholders and added, “Sri Lanka can move at its own pace. No, pressure from India. However, delay has its opportunity cost.”
IPS Executive Director Dr Saman Kelegama inaugurating the sessions said that trade facilitation has become a crucial element of the current trade and development agenda of countries. Improved trade relations measures can contribute to the creation of a consistent, transparent and predicable environment for moving goods across borders smoothly and said that TF can bring significant benefits to governments, businesses and consumers.
He said that trade between India and Sri Lanka has increased substantially over the last eight years, but studies have indicated that bulk of the Indian exports to Sri Lanka are outside the FTA and Sri Lanka’s exports have been dominated by few products. Therefore the potential for the growth and diversification of exports between the two countries has not been fulfilled.
He said that the constraints identified include certain measures that relate to the trade facilitation – including customs processes and assessments of rules of origin. He said that therefore an analysis of the TF issues in the FTA is useful given the significance of bilateral trade.
A large contingent of resource persons participated in this conference. Among them were: Sarath Jayatilake, former Director General, Sri Lanka Customs; Ranjan Sudesh Ratna, Professor, Centre for WTO Studies, Indian Institute of Foreign Trade; Indira Murthy, Deputy Secretary, FT (South Asia) Department of Commerce, Government of India; Samantha Wijesekera, First Secretary Commercial, High Commission of Sri Lanka -Chennai; Biplove Choudhary, Trade Specialist, UNDP Asia-Pacific Regional Centre, Bangkok and Z A N Jaseel, Additional Director General, Sri Lanka Customs.
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