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At a meeting of South Asian Commerce Ministers meeting at Dhaka, India and Pakistan agreed not to charge import duties on 5% of products traded within the South Asia Free Trade Area (SAFTA) region. This decision will immediately benefit Bangladesh, Bhutan, Maldives, Nepal, and Sri Lanka and in return jointly promised to reduce import duties to 0-5% within the next 10 years. The meeting was focused on forward movement of SAFTA agreement signed in 2004 and effective January 2006. The countries decided to draw up a timetable till 2016 for the implementation of SAFTA. The countries also agreed to remove products that each considers sensitive from the list of products that will not be taxed on entry.
SAFTA trade is valued only at USD 6 billion or 4.4% of combined extra-regional trade of SAFTA nations. This low figure highlights decades of lack of regional cooperation. European Union (EU) has 55% intra-regional trade, 61% in North American Free Trade Agreement (NAFTA), and 25% in Association of South East Asian Nations (ASEAN). |
