Bangladesh is tipped to sign a Free Trade Agreement with Sri Lanka to strengthen bilateral trade between the two nations, according to visiting Bangladesh Foreign Secretary Ambassador, Mohammed Shahidul Haque.

“We are extremely optimistic over Sri Lanka’s prospects. Bangladesh agrees in principle to start discussions and explore on all possibilities to strengthen trade with Sri Lanka; including a Free Trade Agreement.

“We believe that bilateral tariffs are very high. If an FTA with Sri Lanka is finalised, it will be Bangladesh’ first ever FTA with any country. A Joint Working Group on Trade is now in order” Haque said.

He made these comments during a meeting at the Industry and Commerce Ministry between a sixmember delegation from Bangladesh and Minister Rishad Bathiudeen and other senior officials.

“The US$ 83 million bilateral trade volume indicates strong and unrealised trade potential between both countries. We too are looking forward to an FTA with Bangladesh, perhaps starting with a Preferential Trade Agreement (PTA).

“To this end, a Joint Working Group on Trade by both countries can speed up the process. We also invite Bangladesh state and private sector investors to Sri Lanka. More than US$ 292 million of Sri Lankan investments by 45 Lankan companies are now in Bangladesh but Bangladeshi investments in Sri Lanka are comparatively low,” Minister Bathiudeen noted.

Sri Lanka’s pharmaceutical sector was highlighted by both parties during the meeting as another potential investment area. According to the Department of Commerce of Sri Lanka, bilateral trade between Sri Lanka and Bangladesh has seen improvements during the last 4-5 years.

The total bilateral trade which was at US $ 48.14 million in 2010 has jumped by a strong 73 percent in 2012 to US $ 83.19 million, showing a rapid rise in business between the two historically-friendly nations.

In 2012, among the top Lankan exports to Bangladesh were Fabrics (47 percent of exports consisting of Cotton, Knitted or crocheted fabrics), enzymes (11 percent), petroleum oils & oils obtained from bituminous minerals other than crude (7 percent), and narrow woven fabrics among others.

About 15000 Sri Lankans are currently employed in Bangladesh and 45 Sri Lankan firms have invested US $ 292 million in the country in various ventures.