In the six months ending June 2020, Sri Lanka had exported Rs 93.7 billion under several trade agreements and imported goods worth Rs 26.64 billion, or three and a half times the imports. Goods of Indian origin exported to Sri Lanka under the EUSFTA are currently duty-free, with the exception of goods of TL 1 180 contained in the Netherlands of Sri Lanka under the EUSFTA. The Parties agree to establish a free trade area for the free movement of goods between their countries by eliminating customs duties on trade in goods in accordance with the provisions of Annexes A and B, which form an integral part of this Agreement. “However, traders` interest in a particular branch of commerce or industry is always different and even opposed to that of the public in some respects,” Smith explained in Wealth of Nations. Top 10 items exported from Sri Lanka to India – 2020 Sri Lanka imported from India mainly outside the free trade agreement, 70% of exports from free trade agreements Top ten items exported from India to Sri Lanka – 2020 CONVINCED of the need to create and promote free trade agreements to strengthen intra-regional economic cooperation and economic development. (a) are covered by a description of the products eligible for concessions in the country of destination under this Agreement; Remittances (foreign savings of foreign workers) and tourism receipts trigger a trade deficit when recipients spend the money, while foreign government loans for deficit financing and foreign direct investment trigger a current account deficit. Products of Sri Lankan origin exported to India ALETP is currently duty-free, with the exception of the following categories of items benefiting from Indo-Lankan concessions that have systematically generated more exports than imports, although mercantilists (nepot capitalists) who want to forcibly sell overpriced products to consumers cornered by import duties have spoken out against it and financed a campaign against free trade. While it is true that the public suffers when imports are heavily taxed, successive governments, with the notable exception of the garment industry, have not pursued export-oriented industrial policies. This has led to poor economic development in the country, which has resulted in low wages – with no high-value-added export industry and persistent trade deficits.
These deficits have led to the impoverishment of the country. The value outside the SL rupee has fallen over the past 40 years. (i) the transit is justified for geographical reasons or for reasons related solely to transport requirements; (ii) the products have not entered into commerce or consumption; and (iii) the products have not undergone any activity other than unloading and transhipment or any activity necessary to maintain their condition. The Government of India grants duty-free access to all exports from Sri Lanka with respect to goods that can be freely imported into India, with the exception of the goods listed in Annex D to this Agreement, in accordance with the following phase-out schedule: ECONOMYNEXT – Several free trade agreements with Asia and the Pacific have resulted in a significant increase in exports as well as imports during the first six months of 2020. the free trade agreement between India and Lanka brings the most results, as official data show. Pl. Visit India`s following website for ISFTA tariff concessions and other Customs Information from India: www.indiantradeportal.in/index.jsp Sri Lanka has a trade deficit with India, with most imports coming from heavily taxed items such as cars that are not included in the Indo-Lanka Free Trade Agreement. “This comes from an order of people whose interests are never exactly the same as those of the public, who usually have an interest in deceiving and even repressing the public, and who, as a result, have both deceived and repressed them many times.” (Colombo/25 November 2020) It is not clear what role the import controls introduced in April 2020 played in trade. Sri Lanka is negotiating broader economic cooperation with India to strengthen current bilateral economic relations.
Although the current free trade agreement between the two countries deals with trade in goods, the proposed agreement will cover trade in services, investment and economic cooperation. Formal discussions on the proposed regime have not taken place since the conclusion of the third round of the Trade Negotiations Committee meeting in July 2008. The two sides have had three rounds of negotiations at the level of the Minister of Commerce and thirteen rounds of negotiations at the technical level since the start of negotiations on the draft comprehensive agreement with India in 2005. Through these negotiations, the two sides were able to reach a reasonable agreement on the level of market access obligations in the areas of trade in goods, trade in services, investment and economic cooperation. However, the negotiation process on the proposed agreement was suspended in 2008 due to concerns expressed by some parties about possible negative effects. Later in 2010, an extensive consultation process with all stakeholders was launched to address these concerns. In this context, the first consultation meeting was held on 27 July 2010, under the chairmanship of the Minister of Industry and Trade, to assess the perspectives of the Representatives of the Chamber, followed by a series of such meetings. During bilateral consultations between Sri Lanka and India in the second half of 2010, the two sides agreed to resume formal negotiations on the basis of a new draft by the Sri Lankan side. As a result, in February 2011, with cabinet approval, an inter-institutional committee was set up to address issues of the proposed agreement with India and prepare a draft text.
The IAC is currently preparing a draft that will be submitted to the Indian side for future negotiations. In the first eight months of 2020, India had bought $396 million in Sri Lankan goods (about Rs 73 billion), behind the UK`s $552 million. But the trade deficit has been used by mercantilists to discredit free trade agreements. Ministry of Commerce, Government of India – Sri Lankan commerce.nic.in/trade/international_ta_indsl.asp had exported goods worth Rs 7.46 billion to Pakistan under a free trade agreement, more than five times the import of Rs 1.33 billion. .