Indo-Lanka bilateral trade tops $ 4bn

Daily News - 27/06/2013

Rishad Bathiudeen, Minister of Industry and Commerce welcomes Indian Commerce Secretary,
S. R. Rao on June 25 at the EDB premises in Colombo.

With bilateral trade crossing $ 4 billion, a new chapter has opened in Indo-Lanka trade ties with the first ever Joint Task Force (JTF) coming into play.

Strong signs of greater Indian market access for Lankan exporters and prompt resolution of trade barriers for them are the other developments in this new turn. “We are working to boost bilateral trade to $ 10 billion and as trade ties have improved greatly, the new understanding reached between both countries is a good sign for our bilateral trade future,” said Rishad Bathiudeen, Minister of Industry and Commerce of Sri Lanka on June 25 in Colombo.

Minister Bathiudeen was addressing the Indian delegation led by S. R. Rao, the Indian Commerce Secretary, on Tuesday at the EDB premises in Colombo. Rao was accompanied to Sri Lanka by Duleep Mehta, Indian DG Commerce and officials of Department of Commerce of India.

The bilateral trade between both countries totalled $ 4.087 billion in 2012 and in January-April 2013, it stood at $ 1.17 billion.

At the successful bilateral Secretarial level commercial cooperation session of June 24 where Indian side was led by S. R. Rao, Indian Commerce Secretary, and Sri Lankan side led by Dr. P. B. Jayasundera, Secretary to the Ministry of Finance and Planning-together with Anura Siriwardena, Industry and Commerce Secretary, both countries agreed on a process of speedy, immediate solutions faced by exporters at both ends.

As a result and henceforth, any Lankan exporter facing difficulties in Indian ports can immediately contact the Lankan Department of Commerce for prompt resolution of the situation at hand. The understanding reached at June 24 Secretarial level meeting has resulted in prompt dispute resolution and removal of non-tariff-barriers faced by Lankan exporters accessing the promising Indian marketplace.

On June 24 , Department of Commerce officials of both sides also successfully concluded the first ever Joint Task Force (JTF) meeting to be held between the two countries.

In 2012, to pursue an effective plan of action to reap the maximum benefits out of the existing mechanism the two governments have formed a Joint Task Force (JTF) that will include both government officials and private sector representatives. The Indo-Lanka JTF is now in operation.

Sri Lankan team at JTF was led by Anura Siriwardena, Secretary, Industry and Commerce while Indian team was led by Arvind Mehta, Joint Secretary – South Asia.

Apart from government officials, reps from private sector too joined the JTF sessions that continued successfully for more than two hours. Reps from Lanka National Chamber of Exporters, Indo-Lanka CEO Forum as well as the Joint Apparel Association of Sri Lanka (JAAF) were in the Lankan team while among the Indian reps were from the Pharmaceutical Export Promotion Council of India (Pharmexcil), Ashok Leyland and one of India’s leading infrastructure development and finance companies ‘Infrastructure Leasing & Financial Services Limited (IL&FS).

During the June 24’s first JTF session, both sides discussed in depth as to ways and means of boosting trade cooperation to new levels.

Indian reps focused, among others, on increasing investments and trade in Sri Lanka in textiles, pharma and automotive component export manufacturing while Sri Lankan reps, in discussing their requirements, highlighted maximum utilisation the FTA and removal of export quotas.

“We are very happy of the results of the meetings we held so far in Colombo,” said Secretary Rao. “The Joint Task Force (JTF) on bilateral trade also completed its first ever meeting on June 24 . The JTF has also decided to meet once in every three months.


We are looking forward to the second JTF meeting in October or November this year,” Rao said. “We want to see Sri Lanka’s exports to India growing further.

Japan to boost SL’s banana exports

news.lk

Japan’s ITOCHU Corporation will help further strengthen Japan-Sri Lanka trade ties under which investments are to be for expanding the island’s banana and tuna fishing industries and greater export opportunities will be provided for products.

Kouhei Watanebe, Chairman , the Japan - Sri Lanka Business Co-operation Councial and  advisor to ITOCHU corporation said this when he and the corporation’s representatives met Economic Development Minister Basil Rajapaksa at the ministry office on Tuesday June 25.

Chairman Watanebe added that ITOCHU was also focusing on developing Sri Lanka's infrastructure, transport sector and environment-friendly coal power plants. According to him President Mahinda Rajapaksa too had discussed these during his last visit to Japan.

Minister Basil Rajapaksa said there was a very good market for banana, pineapple, rambutan and other fruits grown in Sri Lanka where the cultivation was being expanded with government assistance.  He also said that areas like Batticaloa and Kalpitiya were areas most suitable for the cultivation of marine plants and rearing sea leeches.  

The Economic Development Minister admitted the prawn industry here was facing setback at the moment but there is opportunity for improving it.  Referring to investment opportunities in the area of exports, he said it is Sri Lanka which meets 95 percent of the world’s cinnamon requirements.

Minister Rajapaksa added that the peace which now prevails in the country, political stability, environment friendliness, 24-hour power supply and the availability of skilled labour had attracted many foreign investors.


Industry and Commerce Ministry Secretary Anura Siriwardena and a number of senior officials of the ITOCHU Corporation including its General Managers Masazumi Nishikage (Planning and Administration), Kenji Tanaka(Marine Products) attended the discussions.

Lanka, Pakistan trade to reach US$ one bn mark

Daily News - 26/06/2013
by H.D.H Senewiratne

Pakistan High Commissioner Maj Gen Qasim Qureshi at the event. 

The total value of trade volume between Sri Lanka and Pakistan could be increased to US$ one billion soon with the free trade agreement between both countries in place. At present total value of trade volume was US$ 460 million, Pakistan High Commissioner Maj Gen Qasim Qureshi said.

“The Pakistani new government has given concrete instructions for the forward march of foreign policy and is now crafting a strategy to engage in economic diplomacy with Sri Lanka to increase trade,” High Commissioner Qurshi said at a media conference to announce the 8th Expo 2013 in Pakistan. The event was to be held from of September 26 to 29 in Karachi.

He said that with the economic relationship with both countries they needs to focus on trade balance to expand the trading spectrum to non traditional sectors other than the existing traditional exports/imports to reach the total value of US$ one billion target soon.

Maj Gen Qureshi also said that when they sign the trade agreement in 2005 total value of the trade between the two countries were US$ 45 million. Now it has reached more than US$ 460 million and Sri Lanka could increase more export volumes to Pakistan, which has many openings owing to the free trade agreement, he said. He said that trade ministers of both countries will be meeting to improve trade opportunities and also to iron out difficulties in trade. For that a comprehensive proposal would be drafted in the future to reach trading targets, he added.

Minister of Industries and Commerce Risad Bathuideen said growth in trade and our export to Pakistan grew by 10 percent last year. The Minister said that at present trade has increased by 357 percent with the signing of the free trade agreement between the two countries. To reach the US $ one billion target they would lead a strong business delegation to Pakistan soon, Minister Bathuideen said.

Sri Lanka seeks unrestricted market access from India for Sri Lankan exports

Colombo Page

Sri Lanka has sought increased market access from India for Sri Lankan exports as a solution to balance the growing trade deficit with India.

Sri Lanka made this request during a discussion with an Indian delegation arrived in the country to discuss trade and investment.

Indian delegation led by S.R. Rao Commerce Secretary, Government of India arrived in Sri Lanka to discuss trade and investment matters with a Sri Lankan delegation led by Dr. P.B. Jayasundera Secretary, Ministry of Finance and Planning and Secretary, Ministry of Economic Development.

The official talks between the two governments on trade, investment and economic cooperation, co-chaired by Dr. Jayasundera, and the Indian Secretary Rao, were held on 24-25 June 2013 in Colombo.

Anura Siriwardena, Secretary Ministry of Industry and Commerce and Prasad Kariyawasam, High Commissioner of Sri Lanka in New Delhi also were in the Sri Lankan delegation.

The bilateral trade between India and Sri Lanka surpassed US$ 5 billion mark last year but the trade turnover is not equally distributed and Sri Lanka has continued to experience higher trade deficit with its leading trade partner.

During the discussions the Sri Lankan delegation has pointed out that this trend is not viable and there is a need to take steps to increase exports from Sri Lanka to India.

Both sides have agreed that there was considerable potential to expand bilateral trade, in a balanced manner through optimal utilization of the opportunities available between the two economies.

As a solution, the two delegations have agreed to review the respective negative lists and address the removal of non-tariff barriers while establishing a mechanism for resolving trade disputes.

Both sides also agreed to expand the bilateral trade to US$ 10 billion over a period of 3 years, with due recognition to increasing exports from Sri Lanka.

Sri Lanka has emphasized the importance of addressing the growing trade deficit with India and requested market access, by removing prevailing quantity restrictions in the apparel, tea and pepper.

India has offered 8 million pieces of apparel to enter the Indian market without restrictions with immediate effect.

The Sri Lankan side has asked the facilitation of entry of value added products including apparel, high end tea, value added rubber products, floriculture and spices in to the Indian market to help moving ahead progressively towards higher export growth and investments.

Both sides have agreed that there was a need to resume ferry services between Colombo and Tuticorin and also Thalaimannar and Rameswaram.

The Indian Commerce Secretary has emphasized the need for targeted Indian investment with a view to assisting Sri Lanka widen its export base and enable integration into regional supply chains including in the automobile parts and light engineering and pharmaceutical sector.

The Sri Lankan side has emphasized the importance of bringing in more investments in the form of joint venture projects to encourage Sri Lankan private sector and state enterprises to work together in several areas.

Lanka, Eu trade on the rise

Daily News - 24/06/2013

Minister Bathiudeen with Ambassador Bernard Savage

As bilateral trade volume closes in on the crucial $ 5Bn mark, historic dialogue between Sri Lanka and the European Union appears to bolster even further. “We look for better trade levels and also thank EU for its on-going support,” said Rishad Bathiudeen, Minister of Industry and Commerce.

Minister Bathiudeen was addressing Ambassador Bernard Savage (Head of the Delegation to Sri Lanka and the Maldives from the European Commission) on 20 June during Amb. Savage’s farewell courtesy call on Minister Bathiudeen at the EDB premises, Colombo.

According to the Department of Commerce of Sri Lanka, there is an increasing trend in trade and the balance of trade between the two parties has been in favour of Sri Lanka during last nine years.

Total trade between Sri Lanka and EU which was at $ 3 bn in 2004 rose $ 4,946.18 mn in 2012. Sri Lanka’s major export items to EU are apparel, diamonds, tea and rubber products.

EU is also one of the most diversified investors in Sri Lanka, with leading European companies operating in almost all sectors of economy-specially, FMCG, higher education, apparel, infrastructure, manufacturing, agro, technology and even in strategic development projects.

Such EU multinationals as Unilever and British American Tobacco are well embedded to Sri Lankan lifestyle with their decades long FMCG presence.

The UK, Germany, Italy, Belgium, France and Sweden are the leading EU members with investments in Sri Lanka. EU’s specific investment segments include hosiery, knitwear, surf sails, electronic products, light engineering, rubber based products, (e.g. tyres), coir based products, gem and jewellery, diamond processing, tourism and recreational products, security printing, infrastructure development, activated carbon, food processing, computer software, ICT etc. “EU is our number one global trade partner. Our bilateral trade volumes show continuous growth and it has become a major element in our relations.

We look for better trade levels and also thank EU for its on-going support not only on trade aspects but even in various development initiatives here” said Minister Bathiudeen.

“Our cooperation with Sri Lanka is wide ranging including the assistance in tsunami and development. Even bilateral trade levels are showing a rising trend” Amb. Savage added.

According to the EU delegation, more than $ 148 mn (€ 112 mn) also has been earmarked for Sri Lanka under the 2007-2013 “Development Cooperation Instrument”.

China to open doors to Lanka’s apparel sector

The Sunday Times - 23/06/2013

By Bandula Sirimanna

 Sri Lanka’s apparel industry is to get a big boost as the world’s largest textile producer, China is exploring possibilities of opening its huge domestic market to the island’s garment exports, an industry heavyweight said.

Secretary General of the Joint Apparel Association Forum (JAAF) M.P. Tuly Cooray told the Business Times that their umbrella body is to enter into an agreement with the China National Garment Association to allow access for Sri Lankan apparel industrialists to penetrate the Chinese domestic market and also set up joint ventures to produce internationally branded products for overseas markets.

A high-powered, 20-member delegation from the Chinese association visited Sri Lanka recently and held preliminary discussions towards signing a Memorandum of Understanding (MOU) enabling Chinese apparel makers and top global retailers to shift their orders to Sri Lanka due to the rising labour cost in that country, he revealed. He noted that they aim to get duty free access for apparel from

Chinese authorities through another MOU recently signed between China and Sri Lanka to improve and strengthen bi-lateral economic relations between the two countries, particular on trade investment and tourism.

The JAAF has been advocating in the past two years for the need to negotiate market access instruments with new and emerging markets particularly with China as a priority market because of enormous potential it offers.

Although, China is also a top global exporter of apparel, China also imports apparel and in 2012 imports amounted to US $4 billion, he said.

“Our apparel industry which has evolved to be a mature international player is now a supplier to many leading brands and no longer supplies to the low end of the market,” he said.

Sri Lanka has carved out a niche market for itself and does not consider China to be a competitor as it aims to supply to higher end of market by manufacturing for Chinese local brands as well as exporting international brands through manufacturing bases in Sri Lanka, he added.

The vision of the industry is also to make Sri Lanka the apparel hub for Asia as Sri Lanka is no longer a basic manufacturer but a total solution provider with front and back end services to their clients, he revealed.

“Since China is switching over to the higher segment of the market and also the hi-tech industry, the country will need to import garment products. We should seize the opportunity to export our goods there,” he said.

“China has the world’s most complete industry chain, the most skilled workers and the most advanced production equipment, but they don’t have a world famous brand,” he said adding that “Sri Lankan apparel industrialists have already established links with world famous brands like Abercrombie & Fitch, Victoria’s Secret, Next, Levi’s, Marks & Spencer, Reebok, GAP and Banana Republic”.

Sri Lanka’s apparel exports to China were US $15 million in 2012. “With high level of GDP growth and rising per capita income the expanding middle class offers a lucrative market not only for foreign brands but also for Chinese local brands.

Processed food exports top $ 73 m

Sunday Observer - 23/06/2013

“In 2012, 26% of total food and beverages exports were processed foods, at $ 73.4 million.

Our overall processed food exports which stood at $ 67.1 million in 2010 rose to a strong $ 95 million in 2011,” said Minister of Industry and Commerce, Rishad Bathiudeen at the launch of the first International Food Safety and Compliance training sessions for Sri Lanka’s food exporters by Associate Professor of the Department of Food Science and Human Nutrition of the Washington State University, Food Scientist, Dr. Barbara Rasco, were held at the Ministry of Industry and Commerce.

The pioneering session was organised by the Sri Lanka Food Processors’ Association and the Ministry of Industry and Commerce with the Spice Council and VEGA-FEG. The sessions were held from June 11 to June 21.

Dr Rasco has contributed to 200 published scientific papers on Food Science.

She (with Dr Bledsoe) published the first book on Intentional Food Contamination, considered as a criminal practice, in which companies were shown how to deal with food terrorism.

She has worked with hundreds of firms, including Starbucks, Coca Cola, Kraft US, Dole, Cargill Inc and American Sea Foods. “Dr Rasco is a great contributor to global food science specially in the integration of the legal and technical aspects and tries to come up with practices for the global industry to make the overall value chain of food, much safer,” said Minister Bathiudeen.

“This type of awareness sessions are an urgent need which is being fulfilled today, considering that in 2012, 26% of total food, and beverages exports were processed foods totalling to $ 73.4 million. Our processed food exports which stood at $ 67.1 million, in 2010 strongly increased to $ 94.84 million in 2011. In 2012, it stood at $ 73.4 million. The slight decline is a result of the on-going, global market turmoil,” he said.“My Ministry has been extending considerable support to build Sri Lanka’s food processing sector. We allocated $ 197,000 to the Sri Lanka Food Processors Association for this initiative. The other key initiative is the annual Pro-Food Pro Pack exhibition. The 11th exhibition in this series will be held in August at the BMICH,” the Minister said.

“Dr Rasco’s main contribution to Food Science is the integration of the legal and technical aspects and trying to come up with rational practices for the global industry to make the overall value chain of food, safer.

“This is an export sector with strong potential and we need this type of initiatives to sustain our competitive edge,” he stressed. “I am happy to help Sri Lanka’s food industry to secure its exports competitiveness,” said Dr Rasco, who has extensive working background in 30 countries - mostly in Central, South and South East Asia. “Despite the difficulty to get into new export markets and despite being expensive, your food operators and exporters are doing the right thing by following regulatory compliance,” she said. “Americans are beginning to look for spicy food from Sri Lanka. I see new opportunities for Sri Lanka’s full bodied spicy food exports in the US,” Dr Rasco said.

“Representativess from more than 20 leading firms, including Elephant House and Coca Cola took part,” said Administrative Secretary of Sri Lanka Food Processors Association, Ivan Peiris. “This is the first time that a program of this nature took place in Sri Lanka.”