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FTA with Sri Lanka: India seeks duty concessions on vehicles, easier visa norms for its professionals’ entry

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India is seeking customs duty concession on a number of goods including cars, commercial vehicles and machinery from Sri Lanka under a comprehensive free trade agreement (FTA), talks for which are underway, PTA has reported quoting an official.

India has also sought easier visa norms to further facilitate entry of Indian professionals, according to the official.Text of the PTI report: The 14th round of talks between senior officials of India and Sri Lanka was concluded recently in Colombo.

Issues which came up for the talks included rules of origin, goods, services, and technical barriers for trade.On the other hand, Sri Lanka has sought removal of a quota on apparel exports to India. The island nation is also asking for duty concessions on tea and certain agricultural commodities.

The official said that as elections are announced in Sri Lanka, the next round of negotiations between the two countries will be held after that.The two nations have already implemented a free trade agreement in goods and now they are negotiating to expand the pact by including more goods and services.

The India-Sri Lanka Free Trade Agreement (ISFTA) came into force in March 2000. It enhanced economic relations between the two countries by reducing tariffs on a wide range of goods.

Since the original ISFTA focused solely on goods, both countries have been negotiating for several years to expand it into a Comprehensive Economic Partnership Agreement (CEPA), which would include services, investment, and other areas of economic cooperation.

Under the current FTA, India allowed limited imports of garments from Sri Lanka at a 50 percent tariff (or customs duty) concession for up to eight million pieces annually, with a requirement that six million of these pieces use Indian fabric.

Additionally, India offered a 50 percent tariff concession on up to 15 million kg of tea from Sri Lanka each year.

Think tank Global Trade Research Initiative (GTRI) said that Sri Lanka may be seeking removal of the quota on garments, especially considering that India has allowed duty-free imports of garments from Bangladesh under the South Asia Free Trade Agreement (SAFTA) for Least Developed Countries (LDCs).

“However agreeing to this request may not be easy for India as allowing duty free imports has led to a significant increase in garment imports from Bangladesh, growing from USD 144.25 million in FY’2014 to USD 739.06 million in FY’2024, a cumulative growth of 412.34 per cent,” GTRI Founder Ajay Srivastava said.

Sri Lanka has placed items like automobiles and electrical goods on its negative list, restricting their import.

Since the implementation of the ISFTA, trade between the two countries has experienced fair growth.

India’s exports to Sri Lanka increased from USD 499.3 million in FY’2000 to USD 4.17 billion in 2023-24, a cumulative growth of 735.2 percent. Meanwhile, imports grew from USD 44.3 million to USD 1.4 billion over the same period.

In the last fiscal, India’s key exports to Sri Lanka included petroleum products (USD 704 million), cotton (USD 260 million), pharmaceuticals (USD 255 million), refined sugar (USD 206 million), fabric (USD 223 million), machinery (USD 171 million), pepper (USD 90.9 million), car and motorcycle parts (USD 79.3 million), onions (USD 63.4 million), and pulses (USD 32 million).

Notably, India’s exports to Sri Lanka fell from USD 5.1 billion in FY’2023 to USD 4.17 billion in FY’2024, primarily due to a significant reduction in petroleum product exports, which declined from USD 1.78 billion to USD 704 million, GTRI said.

India’s major imports from Sri Lanka in FY 2024 were coffee (USD 103.7 million), garments (USD 55.65 million), animal feed (USD 72.2 million), areca nut (USD 65.5 million), light pepper (USD 44.4 million), rough diamonds (USD 26.9 million), and rubber (USD 26.7 million).

A Sakthivel, Apparel Export Promotion Council Southern Region in-charge, said that India should not extend concessions for garments to Sri Lanka, as the domestic industry could be impacted because of that.

“We, too, make those garments and I think India should not give more concessions,” Sakthivel said.



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CEB trade unions hint at stringent industrial action after talks fail

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Trade unions of the Ceylon Electricity Board (CEB), backed by the powerful Ceylon Electricity Board Engineers’ Union, have warned of accelerated trade union action following the collapse of crucial discussions held on Monday (16) with the CEB Chairman, who also serves as Secretary to the Ministry of Power and Energy.

The issue is expected to take centre stage at today’s press conference, with unions signalling that a token strike, possibly a 12-hour countrywide action, could be staged next week unless authorities urgently intervene.

The meeting earlier this week ended without what union representatives described as any “positive or constructive outcome.”

Trade union leaders expressed disappointment that their key concerns had not been substantively addressed during discussions with the Chairman.

At the heart of the dispute is the unions’ demand for a collective agreement in accordance with Section 18(j) of the Sri Lanka Electricity Act No. 36 of 2024. Trade union representatives maintain that the law provides for structured engagement between management and employees and that a formal collective agreement is necessary to ensure transparency and industrial stability within the institution.

The unions also submitted what they termed a reasonable proposal to safeguard the CEB Employees’ Provident Fund (EPF), voicing concerns over the long-term security of workers’ retirement benefits.

However, according to trade union sources, those proposals were not adequately taken up during the discussions.

A senior electrical engineer told The Island that further internal consultations were being held to decide the next course of action. “There is growing frustration among employees. The issues raised are fundamental and relate directly to statutory compliance and the financial security of staff,” he said.

The Island learns that unless there is meaningful engagement from the authorities, the proposed token strike could mark the beginning of more stringent industrial action.

Energy sector observers warn that any escalation of trade union unrest at the CEB could have serious implications for the country’s power sector stability at a critical time.Further developments are expected following today’s media briefing.

By Ifham Nizam

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PM reveals allowances and perks available to MPs

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Prime Minister Dr. Harini Amarasuriya yesterday (19) revealed allowances and benefits provided to Members of Parliament at present.She did so while responding to a question raised by Samagi Jana Balawegaya MP Chaminda Wijesiri.

According to the disclosure:

An MP receives a monthly allowance of Rs. 54,285, with an entertainment allowance of Rs. 1,000 per month.

Driver allowance is Rs. 3,500 per month; however, if the MP is provided with a driver by the Ministry of Public Security and Parliamentary Affairs, no driver allowance is paid.

Telephone allowance is Rs. 50,000, while transport allowance is Rs. 15,000 per month.

Office allowance amounts to Rs. 100,000.

MPs attending parliamentary sessions receive Rs. 2,500 per day, while Rs. 2,500 per day are given for MPs attending committee meetings on non-sitting days.

Meanwhile, Members of Parliament also receive a fuel allowance based on the distance from their elected district to Parliament.

For national list MPs, this is calculated as 419.76 liters of diesel per month, paid at the approved market rate on the first day of each month.Dr. Amarasuriya also emphasised that these allowances are structured to cover official duties and transportation costs.

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CID expresses regret to Natasha; IGP to issue guidelines on ICCPR arrests

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Former OIC of the Cyber Crime Investigation and Intelligence Analysis Unit of the CID, M.M.U. Subhasinghe, yesterday expressed his regret in writing to civil activist and comedian Natasha Edirisooriya at the Supreme Court regarding her arrest under the International Covenant on Civil and Political Rights (ICCPR) Act.

The Attorney General’s Department, appearing on behalf of the respondents, informed the court that the IGP would issue a set of guidelines via a circular to all police officers to prevent unlawful arrests under this Act in the future. It was further noted that the circular would be issued within two weeks, and the petitioner, Natasha Edirisooriya, has examined and agreed to these guidelines.

These submissions were made yesterday before a three-judge bench of the Supreme Court, led by Chief Justice Preethi Padman Surasena, during the hearing of the Fundamental Rights (FR) petition filed by Edirisooriya challenging her unlawful arrest.

Following these developments, the court ordered the respondents to inform the court via a motion within two weeks of issuing the IGP’s circular and ordered the conclusion of the case proceedings.

Natasha Edirisooriya was present in open court yesterday. Addressing her, Chief Justice Surasena stated that the court appreciates the manner in which the legal proceedings were brought to a conclusion.

The letter expressing regret stated: “As the arresting officer, considering the totality of circumstances, I wish to express deep regret to you for the arrest on 27th May 2023 and your incarceration in remand custody till 5th July 2023 consequent thereto. I also extend my deep regret regarding the damage that may have been caused to your reputation and dignity, and mental and emotional trauma caused by the arrest and incarceration.”

The respondents agreed to express this regret and issue the circular based on the specific conditions put forward by Edirisooriya in consultation with her counsel Suren Fernando and the legal team.

By AJA Abeynayake

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