South and Southeast Asia goods FTA to start from mid-2006

DHAKA, Tuesday (AFP) - Seven South and Southeast Asian nations are set to launch a goods free trade agreement from July 2006, which promises to generate additional trade worth 40 billion dollars, Bangladesh's Foreign Minister Morshed Khan said.

"We are absolutely hopeful that the BIMSTEC FTA in goods will enter into force from July 2006," Khan said after a foreign ministers' meeting of BIMSTEC (Bay of Bengal Initiative for Multi-Sectoral, Technical and Economic Cooperation) in Dhaka.

If the deal comes into full force, it could generate additional trade worth 40 billion-60 billion dollars among BIMSTEC members, the minister said, quoting from a study conducted by a New Delhi-based think tank.

He added that FTA negotiations on services and investments would be concluded later.

BIMSTEC was formed in 1997 in the hope of forging closer trade ties through strengthened transport and information networks in the region. BIMSTEC includes founding members Bangladesh, India, Sri Lanka and Thailand and new members Bhutan and Nepal.

At a BIMSTEC summit in the Thai capital Bangkok last July, the leaders of the seven countries signed a framework agreement paving the way for the free trade area.

The deal also identified trade and investment, transport, tourism, communication, technology, energy and fisheries as areas for "focussed" cooperation.

The joint statement released after the BIMSTEC ministerial meeting said it was satisfied with finalisaing all issues of the FTA negotiations, allowing free trade in goods to come into force from July 1, 2006.

Bangladesh will host the next trade and economic ministerial meeting in January-February at which the free trade agreement on goods is expected to be signed, the statement said.