Second largest SAARC partner hungry for Lankan exports, FTA trade
Rishad Bathiudeen (Minister of Industry and Commerce) discusses with His Excellency Maj Gen Qasim Qureshi (Pakistan High Commissioner to Sri Lanka) on 07 January in Colombo.
Sri Lanka’s second largest trade partner in SAARC is hungry for more Lankan exports in the coming year-while also closely looking at Sri Lanka’s sugar sector for entry! ”Pakistan’s new GSP with EU is an opportunity for Sri Lankan exporters and they can do more things. In fact, we should jointly explore whatever is possible within the rules and regulations of these new developments!” stressed an upbeat Major Genenral Qasim Qureshi (Pakistan High Commissioner to Sri Lanka) on 07 January in Colombo.
High Commissioner Qureshi was addressing Rishad Bathiudeen Minister of Industry and Commerce on 07 January during his new-year courtesy call on Minister Bathiudeen at the Ministry of Industry and Commerce premises in Colombo 03.
Addressing Minister Bathiudeen, (HE) Qureshi revealed: “We believe that there is strong unrealized trade potential between both countries. Through the Joint Economic Commission, we annually review our trade progress of our FTA so that it becomes increasingly ‘commerce-friendly’ for both countries. And there is a trade imbalance between Pakistan and Sri Lanka and we want to reduce that. Which means that we should also explore avenues and ways in which more products from Sri Lanka are exported to Pakistan. So what we want to do is to expand the bilateral trade from the present annual level of $ 440 Mn to $ One billion in the coming years-perhaps even in a couple of years! The way to do this is by exploring areas where we can see new trading starts between the two countries in not just the traditional trade items but also to look at new items and new products. Also, Pakistan’s new GSP with EU is an opportunity for Sri Lankan exporters and they can do more things. Of course the rules of origin are from Pakistan. For example, Sri Lankan exporters can consider more raw material exports to Pakistani industries that are manufacturing to EU using this GSP. In fact, we should jointly explore whatever is possible within the rules and regulations of these new developments!”
According to the Department of Commerce, Pakistan is the second largest trading partner of Sri Lanka in the SAARC region after India. Lankan exports to Pakistan topped $ 42.97 Mn from January to June in 2013 and more importantly, registered a 27% surge from 2010’s $ 60.38 Mn to $ 82.75 Mn by 2012. A substantial growth in bilateral trade is seen in both exports and imports after the Free Trade Agreement between the two countries was implemented in 2005. The total trade has increased from US $ 158 Mn in 2005 to US $. 433.69 Mn in 2012 (and from January to June 2013, at $289.23 Mn). The balance of trade has always been in favour of Pakistan.
Speaking on investments, (HE) Qureshi said: “We are also looking into getting new investments from Pakistan to Sri Lanka because we think that it is not only just commerce but mutual investments too can strengthen bilateral economic relations. We are looking at some areas where we can bring investment from Pakistan to Sri Lanka and we are now keenly looking at the sugar industry in Sri Lanka for new investments.”
Sri Lanka spends around $ 60 Mn for sugar imports and imported $ 3.38 Mn of sugar from Pakistan in 2012. As for Pakistani investment in Sri Lanka, from 2005 to the third quarter of 2013, FDI from Pakistan to Sri Lanka stood at $ 7.5 Mn (cumulative) across 15 investment projects. In November 2013, Tarek M. Khan, President of Pakistan Sri Lanka Business Forum (PSLBF), meeting Minister Bathiudeen in Colombo, revealed that the Pakistani investors have a preference for Sri Lanka due to logistics and rapidly developing infrastructure.
Minister Bathiudeen, who praised Pakistan’s ongoing support to Sri Lanka at various times, responding to Qureshi, said: “It is with pleasure that our government observes that the Eleventh Sri Lanka-Pakistan trade talks concluded successfully on 27 November 2013, a day ahead, helped by the participation of Pakistani Federal Minister of Industries & Production, Ghulam Murtaza Jatoi.” Minister Bathiudeen added: “I believe that in the coming year we should maximize all opportunities presented by our FTA and enhance our bilateral trade levels. Our exporters are already leveraging the PSFTA and it is time our exporters try on new product exports since there are more than 4800 product lines available to them under this PSFTA. I and my officials welcome Pakistani investors and traders keen on Sri Lanka and are always ready to extend our fullest assistance.”