SAFTA ministerial meeting concludes in deadlock

As India and Pakistan could not agree on key issues, the second meeting of the South Asian Free Trade Agreement (SAFTA) Ministerial Council held in Kathmandu on Monday, concluded in a deadlock.

Speaking at a press conference, India’s Minister for Commerce and Industry, Kamal Nath said that Pakistan's non-compliance with the SAFTA spirit has created problems in implementation.

"Pakistan has not complied with what they have signed on," Kamal Nath said.
Addressing a different press conference, Pakistan Commerce Minister Humayun Khan said, "Pakistan has also certain issues with respect to market access being blocked through non-tariff measures and these are the issues we will talk about in the next six months bilaterally."

Both Indian and Pakistani ministers however, expressed hope that through bilateral talks, solutions to the disagreements will be explored in the next six months.

SAFTA signatories are to allow each other to freely trade in 4,200 items approximately.

The Indian side maintained that Pakistan, instead of allowing it to trade in the 4,200 items freely, had provided it with a ‘positive list’ of only 773 items, for which there is no provision in the SAFTA agreement.

The contentious issue of effective implementation of SAFTA, which was expected to be thrashed out at this crucial SAFTA meet here, remained far from being resolved.

SMC urged India and Pakistan to sort out the differences and report the progress in the next SMC meet due after six months.

The first SAFTA Council of Ministers Meeting was held in Dhaka, Bangladesh last year.

Finance Minister Dr Ram Sharan Mahat represented Nepal in the meeting.
Earlier, a meeting of the SFATA Committee of Experts (CoE) which concluded on Sunday had discussed issues pertaining to non-tariff barriers. The two-day CoE meet had agreed to forward the unresolved issues to the ministerial council meeting.

The agreement on SAFTA, which aims at creating a free trade zone in the SAARC region, was reached at the 12th SAARC Summit at the Pakistani capital Islamabad on 6 January 2004.