Pakistan Sri Lanka Free Trade Agreement Advantages And Disadvantages

The pros and cons of free trade agreements affect employment, business growth and living standards: the list of emergency concessions contains a total of 206 six-digit HS (products) positions, and Sri Lanka immediately enjoys 100% duty-free access to the Pakistani market. Free trade agreements should stimulate trade between two or more countries. The six main advantages of strengthening international trade are that Sri Lanka has granted Pakistan a duty-free tariff quota for 6,000 m/t of Basmati rice and 1,000 m/t of potatoes per calendar year (January-December). However, the importation of potatoes is only permitted during the low season of Sri Lankan lands. (2/3, which will be introduced in June – July and 1/3 in October – November each year). Free trade agreements are treaties that regulate the tariffs, taxes and tariffs that countries collect for their imports and exports. The most well-known regional trade agreement in the United States is the North American Free Trade Agreement. Sri Lanka has identified a total of 102 six-digit shs customs lines, on which Pakistan will have 100% duty-free access. Tariff quotas (TRQs) are specific quantities of products for which the importing country would be agreed to grant either duty-free access or preferential duty if imported by the other contracting party to the agreement.

Products that go beyond the agreed TRQ are subject to the normal tariffs applied by the importing country to these products. The agreement contains articles on objectives, definitions, the elimination of tariffs, paratarifs and non-tariff barriers, rules of origin, safeguards, dispute resolution, amendments, annexes, etc. Following the signing of the agreement, the two countries were able, after several rounds of bilateral negotiations, to finalize the annexes of the agreement in December 2004 and February 2005 and exchange diplomatic notes confirming the completion of the annexes. The main criticism of free trade agreements is that they are responsible for outsourcing employment. There are seven global drawbacks: all fully preserved products, such as tea, fish, spices, etc., can easily benefit from tariffs on each other`s markets, provided they can benefit from tariff concessions. Countries can insist that foreign companies build local factories as part of the agreement. They may require these companies to become part of the technology and to train a local workforce. A better solution than protectionism is to include rules in trade agreements that protect against inconvenience. Environmental protection measures can prevent the destruction of natural resources and crops. Labour laws prevent poor working conditions.

The World Trade Organization imposes rules on free trade agreements. Northwestern Journal of International Law and Business. “Trade and Technology Within the Free Trade Zone: The Impact of the WTO Agreement, ALEFTA, and Tax Treaty on the NAFTA Signator,” page 84.