The proposed free trade agreement with Sri Lanka may bring ‘no gain no loss’ result for Bangladesh, a commerce ministry study said.
‘Bangladesh may not be benefited in the short term by signing the proposed FTA with Sri Lanka because of low trade volume between the two countries and also similar export composition of the states,’ said a commerce ministry official quoting the study report on Tuesday.
Commerce secretary Mahbub Ahmed will scrutinise the study report at an internal meeting with the officials of the ministry and Bangladesh Tariff Commission, he said.
The ministry will also share the findings of the study with stakeholders to receive their suggestions about the proposed FTA in line with the study conducted by the BTC, he added.
According to the study, bilateral trade between the two countries is insignificant and prospect of increasing trade volume in the short term is also uncertain.
‘Export items of both the countries are almost similar. And because of such similar export composition, the proposed FTA may not create any opportunity for Bangladesh,’ the study said.
Sri Lankan major export items are apparel and plastic items which are also chief export items of Bangladesh.
Other major export items of Sri Lanka are rubber and rubber products, coffee, tea, fish and electronics products.
The study said that there was no visible prospect of increasing trade in future in term of trade in services.
‘The study shows that there is neither significant benefit nor loss if the agreement is signed,’ a BTC official who was involved in the study told New Age.
In the long term, there may be some benefits as the island country is becoming a stable economy after the end of civil war, he said.
The study suggested that the government should carefully move forward if it takes decision of signing the FTA with the country considering future prospect.
Sri Lanka has been pushing the idea of signing FTA with Bangladesh as soon as possible to boost bilateral trade and investment between the two countries.
In 2011-2012 fiscal year, Bangladesh exported goods to Sri Lanka worth $42.59 million while imported goods worth $32.2 million.
Bangladesh exports items to Sri Lanka include woven garments, pharmaceuticals, jute and jute yarn, knitwear, textile fabrics, sacks and bags, plastic goods, cotton yarn, iron chain, leather, accumulator battery and parts, engineering products and furnace oil.
On the other hand, the country imports chemical products, rubber and rubber products, transport equipment, raw materials for RMG and electric and machinery equipment.
The BTC official said that Bangladesh might not be benefited from import also by signing the proposed FTA with Sri Lanka as the country was not a major import source for Bangladesh.
‘Usually, a country may be benefited by signing FTA with the countries from where it imports a great deal and there is a possibility of expansion of their bilateral trade,’ he said.
newagebd
-With New Age input
