Saarc Countries Trade Agreement

In accordance with the trade liberalization programme, States Parties must meet the following timetable for tariff reduction. Non-least developing countries should reduce the current tariff to 20% and reduce current tariffs in smaller developing countries by 30%. But the system of trade liberalization is not applicable to the sensitive list, since this list must be negotiated between the contracting countries and then negotiated. A sensitive list will include a common agreement between the States Parties in favour of the least developed States Parties. The SAFTA Council of Ministers (SMC) will participate to review the sensitive list every four years to reduce the list. The South Asian Regional Cooperation Association (SAARC) was adopted on 8 December 1985.La ASARC charter was adopted by the governments of Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan and Sri Lanka, with the aim of accelerating the process of economic and social development in the Member States. The Agreement on the South Asia Free Trade Area (SAFTA) was signed at the Twelfth ASARC Summit on 6 January 2004 in Islamabad. The ratification of SAFTA by all Member States is an important achievement. ASARC`s mandate. On 22 March 2006, the SAARC secretariat issued a communication officially announcing the entry into force of the SAFTA agreement effective January 1, 2006. Nepal imported 54,076 tonnes of palm oil from July to August and exported 35,706 tonnes to India during this period, according to the trade organization, referring to import data. The agreement was signed in 2004 and came into force on 1 January 2006, with the wishes of ASAC Member States (Afghanistan, Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan and Sri Lanka) to promote and maintain mutual trade and economic cooperation within the ASARC region by exchanging concessions.

The SEA called on the government to fill a gap in the South Asian Regional Free Trade Pact that was used to circumvent tariffs through imports of palm oil and soybeans from Nepal and Bangladesh. In total, about 36 per cent of trade in South Asia is non-preferential. On the other hand, ASEAN countries do not, on average, have import tariffs on 96% of products, which encourages greater intra-regional trade. Secondly, the region has been very adept at creating an increase in “para-rights”, which are tariffs applied only to imports and not to domestic production: in fact, tariffs under another name. In south Asia, such parametric tariffs have become ubiquitous in Bangladesh (additional tariffs, regulatory taxes), Sri Lanka (port and airport development tax, at a standstill) and Pakistan (regulatory tax, additional duty). These tariffs reinforce general protection, lack of transparency and dispersal of tariffs, as well as the general anti-export bias of trade regimes where they prevail. This paratarif phenomenon is not observed in most countries of the world, including ASEAN countries. Because of their lack of transparency, large countries have generally been able to maintain para-customs tariffs outside of free trade negotiations.