Lanka sets up board for vanaspati quotas

Sri Lanka has agreed to set up a board for vanaspati, bakery shortening and margarine to regulate the distribution of yearly quotas of 2.5 lakh MT among local manufacturers.

The decision follows concerns by India regarding the surge in import of vanaspati under the free trade agreement.

According to the proposal, which was discussed at a meeting of senior officials from both countries in Colombo, the board would apportion the quotas among manufacturers registered with it.

Senior governments officials said the director-general of foreign trade (DGFT) would facilitate and monitor such imports. Quotas decided by the board would be told to the DGFT.

Officials said the imports would be now permitted through private traders and state trading enterprises. At present, such imports are permitted only through Nafed.

Prior to export to India, registered manufacturers in Sri Lanka would be required to obtain a certificate of origin from the department of commerce, officials said.

"The board and the DGFT will jointly monitor the utilisation of the quotas. The two sides discussed that the details would be posted on the website of the ministries concerned to ensure transparency," an official said.

Officials said the two sides also discussed restricting imports of pepper and desiccated coconut from Cochin and Tuticorin ports. Sri Lanka has agreed to New Delhi's proposal to restrict import of pepper to 2,500 MT per annum and of desiccated coconut to 500 MT per annum.

While pepper will be imported at zero duty, a concessional duty of 30 per cent will be levied on desiccated coconut.

"According to the proposal, authorisations for the import of these two items will be equally distributed among importers. The importers will, however, have to apply to the DGFT," an official said.