Thimphu: Advocating deepening of intra- SAARC trade, India on Sunday pressed for implementation of South Asia Free Trade Agreement (SAFTA) in its letter and spirit, in an apparent reference to Pakistan, which has refused to implement the commerce-opening pact in the context of India.
“SAFTA can be an important instrument to deepen intra-regional trade if it is complied with by all member states and implemented in letter and spirit,” foreign secretary Nirupama Rao said at a meeting of SAARC foreign secretaries.
She did not name any country but was clearly referring to Pakistan which has refused to implement SAFTA in the context of India and insists on doing trade with it only on the basis of ‘positive list´.
Pakistan, while signing the SAFTA that came into force on 1 July, 2006, had agreed to implement it without reservation but backed out later.
India has been complaining, even to the SAARC secretariat, that the issue of restricted import of goods from India by Pakistan under the SAFTA was against the letter and spirit of the pact.
At present, the direct annual trade between Pakistan and India is around $2 billion which has a potential to grow $10 billion. The indirect trade between the two countries is manifold.
Rao also pressed for early ratification of the SAARC Agreement on Trade in Services signed at the 16th SAARC Summit in Bhutan in April 2010, saying it will give a boost to realizing the full potential of trade in services in the region.
“India has already submitted its sector-specific request list of services to various members and we hope that the ‘request-offer process´ can soon gather pace at the meeting of the Expert Group scheduled for the end of March 2011,” Rao said.
“The Group on Customs Cooperation is also doing good work for the harmonization of customs standards within the region,” the foreign secretary said.
She also expressed hope that with the appointment of its first director-general, the SAARC Arbitration Council will also contribute to facilitating the trading environment in the region.