Bimstec Ministerial Meeting in Delhi to Review FTA Progress

Narinjara News: 7 August, 2006
Iftekhar Ahmed

The Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation, the economic bloc comprised of seven South and Southeast Asian nations - Bangladesh, Bhutan, Burma, India, Nepal, Sri Lanka, and Thailand - will hold a ministerial meeting in New Delhi from August 8-9 to review the progress of the proposed seven nations FTA.

At this upcoming meeting of the foreign ministers, all outstanding issues will also be discussed.

Bangladesh Foreign Minister M Morshed Khan, who is the current chair of BIMSTEC, will lead Bangladesh in the 9th ministerial meeting and will also hand over the chair to India at the two day meeting. He leaves for India tomorrow.

During July 25 - 29, the senior officials and experts of the Trade Negotiations Committee, or TNC, met in Colombo to review the progress of the FTA, and observed that there were still many issues to resolve before implementing an agreement.

TNC experts also discussed at the meeting last month key trading arrangements such as rules of origin, and lists of items to be opened under the fast track of a trade liberalization program.

The TNC negotiations on the proposed free trade accord began afresh in July after a long stalemate after the first TNC meeting in February of this year. The next meeting of the committee is scheduled to be held in September, but it is unlikely that they will set a new deadline for implementing the FTA as huge tasks still remain unresolved.

The member states have exchanged once already their respective list of sensitive products to be kept out of the Tariff Liberalization Program. The member countries are likely to exchange the lists again after further review before the next TNC meeting.

Technical experts held discussions on a separate framework for a dispute-settlement mechanism. As for the FTA on trade in goods, the negotiators had agreed to open trade under a "fast track" or "normal track" of trade liberalization.

Under the fast track, the members have agreed to bring down tariffs from zero to five percent by June 2009 in the developing countries, and by June 2011 in the least developed member countries.

Under the normal track, however, they will follow a gradual tariff liberalization program. The developing countries will have to reduce tariffs for each other by June 2010, and with the least developed countries by 2012.

While the compliance deadline for developing countries is June 30, 2015, for LDC members it is July 2017.

Besides the FTA on trade in goods, BIMSTEC members have agreed to kick-start free trade areas for service trade and investment from July 2007.

The fate of the economic cooperation would largely depend on the political stability in Thailand, the main mover of the bloc.