16 June 2021 08:34 am Views - 244
Prime Minister Mahinda Rajapaksa in discussion with Bangladesh Prime Minister Sheikh Hasina during his official visit to Bangladesh in March
The Cabinet nod has been received to commence negotiations for a preferential trade agreement (PTA) with Bangladesh to bolster trade flows between the two countries.
Prime Minister Mahinda Rajapaksa and Prime Minister of Bangladesh, Sheikh Hasina in March mutually agreed to enter into a free trade accord for strengthening economic relationships between the two countries, by initially focusiong on the possibility of entering into a PTA with a short list of goods.
Accordingly, the Cabinet of Ministers on Monday approved the proposal furnished by Trade Minister Bandula Gunawardana to initiate discussions with the relevant authorities of Bangladesh to enter into the proposed PTA.
Bangladesh government has already formed a high-powered ‘trade negotiation committee’ and has requested the Sri Lankan government to inform details of the country’s trade negotiation committee to initiate negotiations shortly, according to news reports from Bangladesh.
Bangladesh government was hoping to sign the proposed PTA between the two countries as early as next month. Recently, Bangladesh’s Central Bank approved US$ 200 million currency swap facility to support Sri Lanka’s depleting foreign exchange reserves. Earlier, Sri Lanka and Bangladesh were planning to initiate negotiations for a free trade agreement (FTA) and a joint feasibility study for the proposed FTA was conducted in 2018.
However, Sri Lanka’s trade negotiations and other trade-related developments came into a grinding halt in late 2018 due to the volatile political environment at the time.
Currently, Both Sri Lanka and Bangladesh act as stakeholder member countries of the SAARC Preferential Trading Arrangement (SAPTA), South Asian Free Trade Area (SAFTA), Global System of trade Preference (GSTP), Asia – Pacific Trade Agreement (APTA) and Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC).
“However, trade movements between the two countries lie at a minimum level despite the special provisions under the aforementioned accords,” the Government Information Department stated.
The bilateral trade peaked to around US$ 170 million between the two countries in 2018, with Sri Lanka exporting US$ 133 million worth goods to Bangladesh while importing US$ 37 million worth goods from Bangladesh.