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Lanka-India to ink CEPA

COLOMBO: India is set to sign the long-awaited Comprehensive Economic Partnership Agreement (CEPA) with Sri Lanka on the sidelines of the SAARC summit in Colombo early next month, it was announced last night.

“We hope to have the CEPA signed on the sidelines of SAARC (South Asian Association for Regional Corporation) summit opening August 1. This is India’s first agreement within SAARC member countries,” Gopal K. Pillai, Secretary of the Indian Ministry of Commerce and Industry, told Indian reporters in Colombo.

Pillai held talks with Minister of Investment Promotion G.L. Peiris and virtually finalised the deal. This would be “the second such agreement by India next to Singapore signed in 2005,” he said.

“It is a good overall agreement in line with our engagement with the neighbouring countries. It will be fully operational in three years,” said Pillai.

He added that CEPA covers trade in the areas of goods, services, education and customs cooperation. India signed the Free Trade Agreement with Sri Lanka in 1999.

As a result Sri Lanka’s volume of trade with India increased from US$ 49 million to US$ 516 million. India’s trade volume with Sri Lanka increased from US$ 549 million to US$ 2.7 billion between 1999 and 2007.

“FTA is a win-win situation to both countries. We are really looking at increasing Sri Lanka’s trade volume to US$ 1.5 billion dollars by 2012,” added Pillai.

The Economic Times added: This would mark the end of the over three years of discussions to boost trade and investment between the two countries with focus on developing Sri Lanka’s economy.

“We both have agreed to reduce the negative lists to give a boost to trade and investment,” Pillai told reporters.

The major issues regarding trade in services and value addition by Sri Lankan industry were sorted out to mutual satisfaction, Pillai said.

A decision to set up a Joint Study Group for making recommendations for CEPA was first announced in April 2003 following which the report was submitted in October 2003.

The first round of talks on CEPA were held between Commerce Secretaries in Colombo in August, 2004. The next round was held at New Delhi in February, 2004.

Both countries have agreed to undertake a review at the secretaries level every six months and at ministers level every year, Pillai said.




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