The Metropolitan Chamber of Commerce and Industry (MCCI), Dhaka has noted that the tariff concessions, finalisation of the sensitive lists and duty free market access of some products of the least developed countries (LDCs) under the agreement for operationalising the South Asian Free Trade Arrangement (SAFTA) would make significant contribution to expansion of the sub-regional trade.
"What is, however, most important is the removal of the non-tariff barriers", the chamber stated in its review of the outcome of the latest negotiations at the level of the Committee of Experts (CoE) under the SAFTA accord.
The MCCI urged the government to urgently identify the non-tariff barriers and notify the same to the respective governments of other member countries of the South Asian Association for Regional Cooperation (SAARC).
The chamber said it would expect that the government would involve the trade and industry in the identification process of such barriers.
In its review of the outcome of the latest negotiations at the level of the CoE, the MCCI noted with satisfaction that the SAFTA would come into effect on July 01, 2006.
In this regard, the MCCI identified a number of points. These included the following:
(1) Bangladesh will have 1,254 products in its sensitive list for non-LDCs and 1,249 for LDCs. On remaining products, Bangladesh will have to reduce tariffs to 0%-5.0% by January 01, 2016;
(2) tariffs of the products outside the sensitive list of the non-LDCs will be reduced to 0-5.0% within January 01, 2009. By this time, Bangladesh will have access at 0-5.0% in garments to Sri Lanka and also for other important export products;
(3) Bangladesh will have duty-free access in jute and jute products, fruit products, leather products, ceramic, electrical goods etc. to India. On July 01, 2006, Bangladesh will have duty-free access in garments for three million pieces provided garments are made from fabrics from India and three million pieces provided fabrics are of Bangladeshi or Indian origin. There are 49 Harmonised System (HS) lines under Chapters 61 and 62, which will be subject to 0-5.0% duty without any condition and quota. India may provide another quota access to garments without any condition;
(4) general rules of origin would be CTH plus 40% (3.0% for Sri Lanka and 30% for LDCs). Derogation was provided only in terms of CTSH for 185 products for which CTSH will apply; and
(5) revenue loss will be estimated using a formula and compensation will be available for four years only.