Trade between BIMSTEC members has been growing, with India leading the way in establishing bilateral trade agreements and trade-enhancing measures. The bay area’s geography is a key factor, including the Bangladesh-India 4,096-km border and efforts the two countries have made to introduce various trade-enhancing measures that have increased trade volume. India and Sri Lanka, for their part, signed a Free Trade Agreement in 1998. India and Thailand implemented the Early Harvest Scheme (EHS) of an FTA. India and Nepal share an open border. There are no visa requirements between Bhutan and India, and India’s northeastern states have an unfenced border with Myanmar. For India, BIMSTEC is already a subregion with few trade or investment barriers. However, trade in the region has not reached its optimum level. A regional FTA may be the next key step in enhancing overall economic performance in South Asia
The roundtable is expected to cover the following themes:
Reducing Trade and Regulatory Barriers for Connectivity: Achieving decisive progress on a Free Trade Area (FTA) among BIMSTEC member countries is a cornerstone of the BIMSTEC Charter. First, the FTA will remove impediments to infrastructure connectivity, as cross-border transactions are still subject to various fees, taxes, and regulations. Second, an FTA focused on deep integration (connectivity) elements will help businesses access regional and global supply chains and achieve vast untapped potential. The roundtable will provide a platform to present and discuss various modalities on how progress can be made toward (1) a negotiating mandate (goods and services), (2) recognition of each country’s likely offers and defensive interests, and (3) a timeline for the liberalization process.
Non-Tariff Barriers (NTB): A major impediment to connectivity in BIMSTEC are the administrative and regulatory barriers to trade among member countries. Access to each other’s markets in BIMSTEC has been eroded through sanitary and phytosanitary (SPS) issues: Are product quality or performance requirements, testing requirements, labelling requirements, packaging requirements, conformity assessment, and certification requirements more burdensome than necessary? In addition. port restrictions specifying where goods can enter, cumbersome document requirements stifle cross-border trade.. The session will also address what are the best practices of formulation for trade promoting BIMSTEC rules of origin regime and dispute settlement mechanism under a proposed FTA.
Cross-Border Connectivity – Customs Cooperation and Border Management: Integrated and coordinated border management that actively encourages customs administrations to further improve their collaboration with partner agencies responsible for border operations is key to improving transactions. Integrated (IBM) and Coordinated Border Management (CBM) programs have been actively promoted globally in recent years, which has enabled some countries to effectively cope with the complex nature of international and regional trade. Customs cooperation is an integral part of the BIMSTEC connectivity objective. At a Ministerial Meeting in 2018, progress was achieved on BIMSTEC customs cooperation, finalizing draft text of the Agreement on Cooperation and Mutual Assistance in Customs Matters for the BIMSTEC FTA. The BIMSTEC Trade Negotiating Committee and member states considered the draft text, but a final draft is yet to be accepted by all members. The roundtable will discuss the modalities for completion of the cooperation agreement.
Digital Connectivity (Paperless Trade): Reducing trade costs by addressing cumbersome regulatory procedures and documentation requirements is an essential reform that enables developing economies to more effectively participate in international production networks and use trade as an engine of growth and sustainable development. This can be accomplished by tackling introducing paperless trade and digitization. The roundtable will include discussion on how to accelerate implementation of cross-border paperless trade in the BIMSTEC Region, following the example of ASEAN and building upon the Framework Agreement on Facilitation of Cross-Border Paperless Trade in Asia and the Pacific.