Sri Lanka told time running out for new trade deal with India

July 23, 2010 (LBO) – Sri Lanka could lose more opportunities to access India’s huge market owing to delays in striking a new economic partnership deal with her neighbour, the Indian envoy in Colombo has warned. An existing free trade deal between the two countries has led to a sharp increase in trade that could further expand with a planned new comprehensive economic partnership arrangement (CEPA), Indian high commissioner in Colombo Ashok Kantha said.

India is willing to accept asymmetries in the economic partnership and will not insist on reciprocal market access, he told the 171st annual general meeting of the Ceylon Chamber of Commerce.

“You will always find India as your closest friend and neighbour who will always be in your corner,” Kantha said.

The existing free trade deal gives Sri Lankan and Indian exporters preferential access to each other’s markets, with more access being given to Sri Lankan exports.

But the proposed CEPA that includes trade in services and investment has been blocked by protectionist business sections in the island on fears it could be flooded with Indian products.

Kantha said there were some misperceptions about the proposed CEPA deal