May 25, 2010 (LBO) – A free trade deal between India and Sri Lankan has been partially successful in giving a better deal for the island’s consumers and industrialists with access to cheaper imported products and supplies, an economist said. Some of the cheapest and good quality products were available from India such as pharmaceuticals, scooters, motorcycles, jeeps, lorries, railway and office equipment and machinery, Saman Kelegama, director of the Institute of Policy Studies (IPS) said.
India became a favourite source of supply replacing other traditional suppliers like Japan, he told a seminar organised by the IPS to review the Indo-Lanka free trade agreement (FTA).
“Most were not made in Sri Lanka in a large scale or in the quality required, especially machinery,” he said.
“In that context India became a low cost supplier and contributed to giving a better deal to producers through cheaper machinery imports enabling them to reduce cost of production in manufacturing whether for export or as import substitution products.”
Sri Lanka’s import substitution industries remained protected under the deal by being placed in the ‘negative list’ under which no tariff concessions were given.
These include agriculture, fishe