Boosting Sri Lanka-Pakistan bilateral trade levels and cooperation Pakistan has now eased tariffs on three Lankan commodities it directly imports from Sri Lanka, states the Minister of Industry and Commerce.
“On behalf of Economic Development Minister Basil Rajapaksa, I thank the government of Pakistan for honouring Minister Basil’s requests and reducing tariff on three Lankan export items. This is a step in the right direction as opportunities under our FTA are not fully utilized and it’s time to do so” said Rishad Bathiudeen, Minister of Industry and Commerce.
Minister Bathiudeen was addressing Maj Gen Qasim Qureshi, the High Commissioner of Pakistan to Sri Lanka on 24 April when the High Commissioner made a courtesy call on Minister Bathiudeen at the EDB premises, Colombo.
“I too fully agree that many opportunities under Lanka – Pakistan FTA are not fully utilized and it’s time to do so. Our bilateral trade basket needs to be diversified further since its concentrated around 4-5 major commodities. For example, Pakistan has a big sugar industry but Sri Lanka does not import sugar from Pakistan. Also, exploring a formal mechanism for the interaction of various bilateral Business Chambers is a way forward to boost our trade and more importantly, investments” said Qureshi.
Currently, there are 25 BOI projects undertaken by Pakistani investors in Sri Lanka covering garments, chemicals, petroleum, rubber, plastics, leather products, food and beverages, and tobacco. Qureshi added: “Sri Lanka’s (import) tariffs are a problem for Pakistan. But we have eased our import tariffs on three commodities from Sri Lanka-namely crude coconut oil, betel leaves, and bottle cooling machines.”
According to the Department of Commerce of Sri Lanka, Pakistan imports 5,000-6,000 MT of betel leaves annually. Sri Lanka is the largest supplier followed by Thailand, Bangladesh and India. Pakistan is the only single market for Sri Lanka’s betel leaves. Pakistan has reduced Lankan betel import tariff by 35% (In 2010, $ 5.77 Mn valued Lankan betel leaves were exported to Pakistan). Pakistan has also reduced tariff on Lankan crude coconut oil by 50% and with effect from July, the crude coconut oil duty waiver will be 100%! (In 2011, Sri Lanka exported $ 1.25 Mn crude coconut oil to Pakistan. Previously, Pakistan agreed to remove crude coconut oil from its no concession list and phase out in two annual installments and provide market access for bottle cooling machines on a Margin of Preference of 50%).
Followed by India, Pakistan ranks as the second largest buyer Sri Lankan products in the SAARC region, accounting about 10% of Sri Lanka’s total exports to the region.
“Bilateral trade between both countries experienced a substantial growth after Free Trade Agreement between the two countries was implemented in 2005. The total trade which stood at $ 158 Mn in 2005 rose to $ 433.69 Mn in 2012, showing a strong 174% growth!” stressed Minister Bathiudeen.
Both Minister Bathiudeen and the High Commissioner were on the consensus that the 11th Joint Economic Commission Sessions should be concluded before the end of Y2013. The bilateral Commerce Secretary level meetings on the forthcoming 11th Joint Economic Sessions (JEC) between both countries, which started on 29 April successfully concluded on 30 April in Islamabad.
The previous (10th) Lanka-Pakistan JEC was held in Islamabad on 4-5 July 2011 successfully covering a wide range of subjects, including trade in goods, services, agriculture, tourism, science and technology, education & air services, and technical assistance.