• Framework on economic and technology cooperation to be ready by January
• Non tariff barriers to be reviewed
• SL following India’s GST approval, hopes to increase tourism and training
• Opportunities available for local businesses to enter Indian value chain market

Development Strategies and International Trade Malik Minister Samarawickrama, India’s High Commissioner Y.K Sinha and India Trade Promotion Organization General Manager V. Meera cutting the ribbon at the opening of India Sourcing Fair 2015 at SLECC in Colombo  - Pic by Shehan Gunasekara.

By Shehana Dain

A high level group from Sri Lanka will visit India later this month to boost a multifaceted bilateral relationship within both countries via a framework agreement, a top Minister revealed yesterday.

With regard to the Joint Economic and Technological Cooperation agreement’s framework which is in the making, Development Strategies and International Trade Minister Malik Samarawickrama noted that the group who will leave to India on 21 December will assure win-win solutions for both parties.

“This agreement has to ensure that it would be beneficial to both countries and provide a win-win situation. We hope to have a framework agreement on place by January next year. Some of the areas where we had some issues in the past have been addressed and the High Commission and Indian Department of Commerce have been extremely cooperative with us. The issues with the non tariff barriers are now been addressed,” he pointed out.

Samarawickrama made these remarks addressing the opening ceremony of the first India Sourcing Fair organised by the India Trade Promotion Organisation.

“In a small country like ours that has a much larger one as a close neighbour and main trading partner; it’s in the interest of the smaller nation to have a rules based framework for its economic relations with the larger economy. We are pleased that India has accepted these principals to govern our bilateral trade relations,” he added.

Moreover the Minister highlighted that the discussions will closely follow the GST (Goods and Services Tax) approval from the Indian Parliament.

“If GST is passed in the Indian Parliament as the general expectation seems to be positive now. It will mark an important step towards creating a single market which will make it easier for Sri Lankan exporters to do business in India. These are some of the reasons why priority is currently been attached to the Joint Economic and Technological Cooperation Agreement.

He also added that the agreement will look into expanding people contact particularly in tourism and training sectors. “As far as tourism is concerned, the Buddhist pilgrimages to the historical sites in India and the Ramayana trail for Indian tourists to Sri Lanka offer attractive propositions,” he elaborated.

Samarawickrama went on to say that the make in India strategy pioneered by Indian Prime Minister Narendra Modi is likely to generate new manufacturing production networks that will create new opportunities for Sri Lankan businesses to enter Inter Indian value chains.

“Improving infrastructure in both countries will reduce transaction costs and also will boost advantages of proximity particularly in Sri Lankan business seeking to enter Indian value chain.”

He also noted that 67% of Sri Lanka’s exports to India go on preferential terms whereas about 70% of India’s imports to Sri Lanka come into our country without the benefits from preferential access.

This means though that there is a large bilateral trade deficit in favour of India, most imports come into the country on the basis of competitive sourcing. That is either the cheapest or the best value for money.