SAFTA: An Analysis of the Potential Restrictions on Free Trade
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Date
2013-09-11
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Abstract
Under the proposed tariff liberalization programme (TLP), SAFTA will become fully effective for non-LDC member countries of SAARC by 2013 (and by 2016 for LDC member states). However, under the negotiations on sensitive lists, each country has been permitted to exclude 20 per cent of tariff lines which are not subject to the TLP. In effect, it means that a substantial proportion of trade within the South Asian region may in fact be excluded from the principle of ‘free trade’. The primary objective of the proposed study aims to make an initial assessment of the extent of such excluded intra-regional trade; in doing so, it will offer a brief background to the rationale for promoting regional economic cooperation in South Asia and examines the current forms of trade initiatives in the region, including bilateral FTAs that can impinge on efforts by SAARC to foster trade linkages. Followed by the examination of the scope of the SAFTA Framework Agreement study offers quantitative estimates of the volume of intraregional trade excluded from the SAFTA process. Finally it outlines a set of policy recommendations to strengthen the SAFTA agreement and meet the objectives of ensuring liberalization of trade within the SAARC region.
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SAFTA, Tariff liberalization, SAARC, Trade