Trade Fiasco

Sept 21 (LBO) – Another round of Indo-Lanka trade talks ended this week, with no firm agreement on resuming controversial duty free exports of vanaspati oil from Sri Lanka to India.

The Vanaspati Association of Sri Lanka says however that they have been kept in the dark about talks.

Vanaspati is a hydrogenated vegetable oil made from palm oil extracts. Bulk of Sri Lanka™s duty free exports to India is limited to vanaspati, copper and spice.

India is the island™s third largest trading partner, with both countries clocking up two billion dollars in trade in 2005, expected to hit three billion dollars within a year.

Both sides agreed to specific quotas on exports of the vegetable oil, as well as restrictions on exports of pepper to protect India™s domestic industry, but could not finalise how to implement it.

The talks were inconclusive. We could not come to an agreement on the modalities and still need to iron out some areas. Talks are continuing, Manel de Silva, Director General of Sri Lanka™s commerce department, told LBO on Thursday.

Quotas for duty free exports have been restricted to 250,000 metric tonnes of vanaspati, similar pr