The Agreement on South Asian Free Trade Area (SAFTA) aims at further enhancing the programme of regional economic integration through promotion of preferential trade, which commenced with the establishment of SAPTA. All countries completed the respective Trade Liberalization Program (TLP) under the Phase I and II of SAFTA, i.e. brought down tariffs to a level between 0-5 percent on all products other than those in the respective Sensitive Lists. Sri Lanka has been accorded a Special treatment in Rules of Origin under SAFTA.

Discussions on further reduction of Sensitive Lists under Phase III of SAFTA, a proposal of Fast Tracking reduction of SAFTA Sensitive List (reducing peak tariff on all products to 0 - 5% by the year 2020, excluding a small number of about 100 tariff lines) and implementation related matters under SAFTA are ongoing.

SAFTA - at a glance

Date of signing of the agreement Date of coming into effect Members Negotiation approach Products coverage
06th January 2004
01st January 2006

India,Pakistan,Sri Lanka,Afganistan,Bangaladesh,Bhutan
Maldives and Nepal

Negative List All products other than those are in  the *sensitive list of the respective member state

*Sensitive Lists under SAFTA

Member State
 
Number of Products in the Revised Sensitive Lists (in HS 2012 version)
Afghanistan 850
Bangladesh 987 (LDCs) / 993 (NLDCs)
Bhutan 156 
India 25 (LDCs) / 614 (NLDCs)
Maldives 154  
Nepal 998 (LDCs) / 1,036 (NLDCs)
Pakistan 936
Sri Lanka

925 (LDCs) / 1,058 (NLDCs)

 Rules of Origin Criteria (RoO) under SAFTA applicable to Sri Lanka – at a glance

Wholly obtained products

Not Wholly obtained products

With Sufficient working or processing

Value Addition

+

Change in HS classification

General Rule

OR

Cumulative Rule

CTH

OR

CTSH under PSR

35% < DVA

OR

PSR

50% < RAC

AND

20% < DVA

 

DVA = Domestic Value Addition

RAC = Regional Aggregate content

PSR = Product Specific Rules

CTH = Change in Tariff Heading

CTSH = Change in Tariff Sub-Heading

 

Statistical Analysis

Sri Lanka’s country wise exports and imports under SAFTA                                                                       

Value in US$ Mn

Country

2016

2017

2018

2019

2020

Exports

Imports

Exports

Imports

Exports

Imports

Exports

Imports

Exports

Imports

Afghanistan

-

-

-

-

-

-

-

-

-

-

Bangladesh

2.49

0.10

5.98

0.18

4.25

0.17

8.33

0.60

5.75

0.55

Bhutan

-

-

-

-

-

-

-

-

-

-

India

4.67

6.14

34.65

5.79

30.47

5.27

46.62

5.78

35.88

3.57

Maldives

0.02

-

0.03

-

0.03

-

0.05

-

0.15

-

Nepal

0.27

-

0.29

-

0.15

-

0.04

-

0.09

-

Pakistan

0.06

0.01

0.13

0.01

0.44

0.02

0.86

0.01

0.38

0.00

Total

7.51

6.24

41.08

5.97

35.34

5.46
55.89
6.39
42.25
4.13

Source: Sri Lanka Customs

                                                                     

Sri Lanka’s product wise exports under SAFTA                                                                                                                                                                                                                                                                                                                                                                                                       

Value in US$ Mn

HS

Description

2016

2017

2018

2019

 

Change in 2020
over 2019 (%)

Share in 2020
(%)

090411

Pepper of the genius piper,
Light berries of pepper

3.85

33.35

26.86

17.32

23.51

35.71

55.64

080111

Coconut Desiccated

0.02

0.18

1.76

27.10

10.10

(62.72)

23.92

761290

Aluminum casks, drums, cans

2.13

5.15

3.71

6.40

3.82

(40.31)

9.04

Other

1.52

2.40

3.01

5.07

4.82

(5.00)

11.40

Total

7.52

41.08

35.34

55.89

42.25

(24.42)
100.00

Source: Sri Lanka Customs

                                                                                                                                                                                                                            

Sri Lanka’s exports to India under SAFTA                                                                                                                                            

 Value in US$ Mn

HS

Description

2016

2017

2018

2019

2020

Change in 2020
over 2019 (%)

Share in 2020
(%)

090411

Pepper of the genius piper, Light berries of pepper

3.85

33.35

26.86

17.32

23.51

35.71

65.52

080111

Coconuts Desiccated

0.18

1.76

27.04

10.10

(62.64)

28.16

Other

0.83

1.12

1.85

2.26

 2.27

0.39

6.31

Total

4.67

34.65

30.47

46.62

 35.88

(23.05)

100.00

Source: Sri Lanka Customs