'Need to finalise various modalities for operationalising FTA among BIMSTEC nations'

There is an urgent need to finalise various modalities for operationalising free trade agreement among BIMSTEC nations, said a senior official of the seven-member economic bloc that includes India.

The Bay of Bengal Initiative for Multi-Sectoral Technical Economic Cooperation (BIMSTEC) members include India, Bangladesh, Nepal, Bhutan, Sri Lanka, Myanmar and Thailand.

"The long pending BIMSTEC Free Trade Area needs to be established as early as possible. Significant progress has been made in finalising the agreement on trade in goods, which should be signed as early as possible," BIMSTEC Secretariat's director, DB Paudel, said while addressing an event organised by Indian Chamber of Commerce (ICC).

Besides, an agreement on cooperation and mutual assistance in the matters of customs should also be concluded soon to simplify customs procedures, he emphasised.

Paudel said well-developed transport connectivity is a prerequisite for reaping the benefits of free trade area.

Speaking on the occasion, Exim Bank's managing director David Rasquinha said though BIMSTEC Free Trade Area Framework Agreement was signed in 2004, it is yet to be made operational.

There is a lack of consensus in various areas including modalities of tariff reduction and elimination, criteria for rules of origin, customs operations and negotiations on agreements on services and investment, among others, he said.

A viable solution which takes care of the mutual interest of member countries is needed to unlock the huge trade and investment potentials that exist in the region," Rasquinha said.

He said the total trade between India and other BIMSTEC member states have increased around three-fold in the last ten years, from USD 13.7 billion in 2008-09 to USD 39.4 billion in 2018-19.

While India's exports to BIMSTEC countries increased over three-fold from USD 8.8 billion in 2008-09 to USD 28 billion in 2018-19, the country's imports from BIMSTEC region has also more than doubled from USD 5 billion in 2008-09 to USD 11.4 billion in 2018-19, he said.

BIMSTEC constitutes a bridge between South and South East Asia and represents a reinforcement of relations among these countries.

The region is home to around 1.5 billion people which constitute around 22 per cent of the global population with a combined gross domestic product (GDP) of USD 2.7 trillion economy.