Nepalnews.com Mercantile Communications Pvt. Ltd.

SMC meet concludes inconclusively

The second meeting of the South Asian Free Trade Area (SAFTA) Ministerial Council (SMC) held in Kathmandu concluded in a deadlock due to the disagreement between India and Pakistan.

India raised the issue of non-compliance of the SAFTA agreement by Pakistan and maintained that Pakistan had resorted to selective implementation of the multilateral trade agreement in the case of India, violating the very essence of SAFTA.

India also warned that it could withdraw market access facilities to Pakistan, if the later refused to open up its market for Indian products as agreed in the regional pact.

Pakistan, on the other hand, claimed that India had not extended to it the Most Favoured Nation status even though it had granted the same to India.

Commerce ministers of all SAARC countries had participated in the meeting. But the meeting was largely dominated by the Indo-Pak differences over SAFTA.

SAFTA signatories are to allow each other to freely trade in 4,200 items approximately.

The Indian side maintained that Pakistan, instead of allowing it to trade in the 4,200 items freely, had provided it with a ‘positive list’ of only 773 items, for which there is no provision in the SAFTA agreement.

India also maintained that it had offered every concession to Pakistan that had been granted to other SAFTA members by it.

SMC urged India and Pakistan to sort out the differences and report the progress in the next SMC meet due after six months.

SAFTA envisions zero duty on trade by 2012, following a series of annual cuts. Nepal, Bhutan, Bangladesh and the Maldives, which are regarded as the least developed countries in the regional bloc, will get an additional three years to acquire zero duty status. nepalnews.com pb Feb 27 07