As bilateral trade jumped by 67%, Sri Lanka and Bangladesh have begun exploring the possibility of a historic Free Trade Agreement (FTA). And while it would be the first ever FTA for Bangladesh, for Sri Lanka, it is no less than a single entry-point for a huge regional economic corridor.
“There are so many sectors where both countries have their own comparative advantages-in some Sri Lanka is strong, in some others, Bangladesh is strong. I hope that this Free Trade Agreement-at least, the possibility of signing it, will bring the two countries closer. I believe that discussions and planning of these two days would indicate as to how we can start negotiations for the FTA” said Manoj Kumar Roy, Additional Secretary (FTA), Ministry of Commerce of Bangladesh and Leader of the Visiting Delegation) on 22 September in Colombo.
Bangladeshi Additional Secretary Kumar Roy was addressing the second Bangladesh-Sri Lanka Joint Working Group on Trade that began in Colombo on 22 September. The first meeting of the Bangladesh-Sri Lanka Joint Working Group (JWG) on Trade was held in Dhaka in February 2014. For the latest session, Bangladeshi Additional Secretary Kumar Roy is leading a five member Bangladeshi delegation to Colombo for the two day talks that are scheduled to end tomorrow 23 September. The Bangladeshi team is joined by FM Borhan Uddin (Acting High Commissioner, High Commission of Bangladesh, Colombo). Sri Lankan team is led by Anura Siriwardena (Secretary, Ministry of Industry and Commerce) and consists of RDS Kumararatne (DG-Department of Commerce) and DoC officials, as well as reps from Sri Lanka Standards Institution, Ministry of Economic Development and Tourist Board, Department of Trade and Investment Policy, Department of Customs, and the EDB.
“Bangladesh and Sri Lanka are related in so many ways. Trade is an important sector in B’desh-Sri Lanka relations and these two countries can integrate for mutual benefits of each other. The symbiosis in providing goods and services benefits both countries. We both are members of WTO, in multilateral trading system, in SAPTA, APTA and BIMSTEC” Bangladeshi Additional Secretary Kumar Roy, and added: “Already we passed so many years in integrating our trade to each other. Our government led by Prime Minister Sheikh Hasina, places much importance on bilateral relations between Bangladesh and Sri Lanka. Last time we appraised Prime Minister Sheikh Hasina, through our official summaries that we are interested in a Free Trade Agreement with SL and to start a Joint Study,
Prime Minister Sheikh Hasina expressed her pleasure saying that “Yes, If Ministry of Commerce of Bangladesh and Lankan authorities can progress then it will be a milestone in bilateral relations of the two countries. The trade volume between both countries is not very high, but considering the potential, I hope that if we can work through the FTA, and then it will surge to $ 01 Bn. What is important is not separate export or import values but the total trade volume. Both the government and the businesses have the responsibility to provide quality goods and services at competitive prices to its citizens, then if it is economic, it is better. There are so many sectors where both countries have their own comparative advantages-in some Sri Lanka is strong, in some others, Bangladesh is strong. These comparative advantages will make it fruitful in signing the Free Trade Agreement. Trade is now the melting pot of the world, bringing citizens much closer, and even other ties are now basically dependent on trade sector. I hope that this Free Trade Agreement-at least, the possibility of signing it, will bring the two countries closer. I believe that discussions and planning of these two days’ would indicate as to how we can start negotiations for the FTA.”
If Bangladesh-Sri Lanka FTA is realised, it will be the first ever FTA for Bangladesh, whose GDP stands at $140B. As for Sri Lanka, it would open a single entry point for an important regional economic corridor-the BCIM economic corridor (Bangladesh, China, India, and Myanmar corridor) – giving it the much needed strategic trade connectivity to Myanmar, Eastern Indian ‘continent’ and more importantly, a faster jump-off point to the ASEAN markets.
According to the Department of Commerce of Sri Lanka, bilateral trade between both countries jumped by a strong 67% in 2013 to $ 139.23 Mn (from 2012’s $ 83.19 Mn). Sri Lanka’s leading exports to Bangladesh in 2013 were apparel (cotton, fabrics, Narrow woven fabrics and other articles of apparel) and enzymes. Leading imports from Bangladesh in 2013 were medicaments, apparel, electric accumulators, and potatoes.
“I do hope our distinguished guests would enjoy your stay in my country which has embarked on a new journey towards a new era of development under the able leadership of President Mahinda Rajapaksa. At the same time, I am confident that Colombo deliberations of the Joint Working Group would set up a new milestone in our trade and economic relations” said Anura Siriwardene, Secretary, Ministry of Industry and Commerce of Sri Lanka, addressing the session, and added: “Excellency, as indicated in some of the literature, our two nations have been historically linked from the time immemorial. Sri Lanka’s first King, as mentioned in the ancient Pali Chronicles, had ancestors from the then “Vanga Kingdom” located in modern Bangladesh. Building upon these deep rooted long-standing relations, today, Sri Lanka and Bangladesh are enjoying extremely strong trade and economic, cultural, financial and political relations, and sharing common views on many regional and international issues which are of interest and concern to two countries. I am pleased to place on record with appreciation that both the nations, have always stood by each other in much needed and difficult times. Excellency, as we know, both our nations are members of SAFTA, APTA and BIMSTEC. Besides, we do have a vast range of complementarities, which can be harnessed and translated into tangible and mutually beneficial business alliances to complement the endeavours of two nations on achieving a balanced and sustainable progress.
“I trust we have taken a promising decision to lay a solid foundation by way of setting up a Joint Working Group on Trade and consenting to conduct a joint feasibility study to explore ways and means of further strengthening bilateral trade and economic relations, with the aim of elevating our relations to new heights in the years to come. Excellency, as we see total trade between the two countries has reached up to US$ 107million by 2013, which signifies a growth rate of 67% compared to 2012. I trust that we can sustain and further expand this positive momentum by conscious and concerted efforts within the frame-work of Joint Working Group. It is noted with satisfaction that a number of Sri Lankan businesses have substantially invested and a number of Sri Lankan professionals are working in Bangladesh. We, too sincerely welcome the Bangladeshi business community to seek new opportunities emerging in Sri Lanka in the post conflict era”, said Secretary Anura Siriwardena.
RDS Kumararatne (DG-DoC) said: “If this FTA is realised, it will be the first ever FTA for Bangladesh and therefore it will be historic for them. Also important are the trade complementarities that both countries can explore.”
In the Joint Statement issued by the leaders of both countries during the State visit of Sri Lankan President Mahinda Rajapaksa to Bangladesh from 18 – 20 April, 2011, the need of enhancing bi-lateral trade relations between the two countries was emphasized.