Lanka-India to conclude CEPA talks soon
India and Sri Lanka will conclude negotiations for a Comprehensive
Economic Partnership Agreement (CEPA) by the end of this year. The
agreement also provides for opening up the services sector including
financial services in both countries.
"We are also considering opening up accounting and legal services,
which are relatively easier compared to banking.
For this, we have to arrive at an understanding with the respective
regulators of these professions in India," Central Bank Governor Ajith
Nivard Cabraal said in New Delhi.
Cabraal said that his Government wants banks to come up with new
products such as micro-finance and infrastructure.
New products would be the entry point for foreign banks. The country,
which already has a double taxation avoidance treaty with India, has
strict controls over ownership of banks with no single group of
shareholders allowed to hold more than 15%.
This would be one of the areas for negotiation. There are 24 banks in
Sri Lanka, of which 13 are foreign banks. There are four Indian banks in
the island nation, where banking service is quite strong in the western
province, said Mr Cabraal.
Sri Lanka's exports to India are about $300 million, while its
imports from India are $2.5 billion. India is a major market, but
customs regulations are slowing down exports to India, said a member of
the Sri Lankan delegation to the capital.
Sri Lanka expects retail price inflation based on 1952 consumption
pattern to come down to 13% by this year end.
"The actual figure may be much less, which we will come to know after
we come out with a new inflation index in November based on 2002
consumption pattern. We expect it to come down to single a digit next
year", said Cabraal.
Economic Times, India