SL, Bangladesh to sign Customs cooperation deal

Thursday, 8 July 2021 00:00 - - {{hitsCtrl.values.hits}}

Sri Lanka and Bangladesh are to sign an agreement to promote cooperation between the Customs of the two countries.

The agreement will foster mutual cooperation and administrative assistance on customs activities in between Sri Lanka and Bangladesh with the objectives of evaluating the tariff such as customs duty and other taxes accurately, properly empowering the banning, restricting, and control actions on specific goods by Customs administration, as well as precisely empowering the Customs Law against Customs errors, etc.

The Cabinet of Ministers at their meeting on Monday approved a proposal in this regard submitted by the Prime Minister as the Minister of Finance.

The Customs agreement comes hot on the heels of Cabinet last month approving the decision to start discussions towards finalising a Preferential Trade Agreement (PTA) with Bangladesh.

The Government is confident a PTA will boost trade between Sri Lanka and Bangladesh, which is relatively small at $ 200 million.

Moves towards a PTA follow Sri Lanka and Bangladesh in March agreeing to strengthen economic relationship via a free trade pact during Prime Minister Mahinda Rajapaksa’s State visit to Dhaka.

The proposed PTA will contain a short list of goods as the initial step, according to the proposal made by Trade Minister Bandula Gunawardena. Both Sri Lanka and Bangladesh act as stakeholder member countries of the SAARC Preferential Trading Arrangement (SAPTA), South Asian Free Trade Area (SAFTA), Global System of trade Preference (GSTP), Asia-Pacific Trade Agreement (APTA) and Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC).

However, the Government said trade between Sri Lanka and Bangladesh was low despite special provisions under these accords and the PTA would be a catalyst to enhance volume.

Sri Lanka’s imports from Bangladesh account for 0.3% of the total. Last year’s value was $ 48 million up from $ 41 million in 2019 but lower in comparison to $ 44 million in 2017. Sri Lanka’s exports to Bangladesh account for only 1.5% of the total. Last year the value was $ 153 million, down from $ 162 million in 2019.

Once finalised, Bangladesh will be the third South Asian country with which Sri Lanka has a free or preferential trade arrangement after India and Pakistan. Both FTAs have helped to enhance bilateral trade.