Pakistan, Sri Lanka likely to ink two MoUs for deepening trade and investment

Pakistan Prime Minister Nawaz Sharif along with a delegation will be visiting Sri Lanka next week where the two countries, Pakistan and Sri Lanka are expected to ink two MoUs for deepening trade and investment ties.

First agreement will be between the Trade Development Authority of Pakistan and the Sri Lankan Export Development Board in a bid to promote trade and exchange delegations between the two sides, a senior official in the Ministry of Commerce said.

The second MoU will be between the Pakistan Institute of Fashion Design and the Sri Lankan Gems and Jewelry Training and Research Institute for imparting training to Pakistani students.

During the PM’s visit, the sixth secretary-level technical talks will be held between trade officials of the two sides on various technical and trade-related matters.

The two sides are also expected to discuss enhancing business-to-business partnership for which the Pakistani traders will organize a single-country exhibition in Colombo from January 15 to 17, showcasing commodities produced in Pakistan. Similarly, Sri Lankan businessmen will also hold a trade show in Pakistan.

Pakistan and Sri Lanka already have a free trade agreement (FTA) in place since 2005, but are eager to further liberalize the partnership in order to expand scope of the FTA from goods to services and investment.

The FTA with Sri Lanka has a significant importance because it was the first trade accord Pakistan signed with any country. Apart from this, Colombo is one of the closest business partners of Islamabad among regional nations as ties with India and Bangladesh often turn sour and hurt the trade relationship.

According to the Sri Lankan Commerce Ministry official, it has an edge in export of finished and made-up garments whereas Pakistan’s strength is in fabrics and textile products. It will be a big breakthrough if they succeed in including services and investments in the FTA.

At present, the volume of trade between Pakistan and Sri Lanka is $350 million, the two countries are looking at increasing it to $1 billion by expanding its scope.