Piyush Goyal suggests BIMSTEC group members to relook proposed FTA

New Delhi: Commerce and Industry Minister Piyush Goyal on Wednesday suggested the seven member countries of the BIMSTEC bloc to relook at the progress of Free Trade Agreement talks which are moving at a very slow pace.

He said that the members can think of negotiating a preferential trade agreement instead of a full-fledged free trade pact.

BIMSTEC stands for the Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation. Its seven members are five South Asian countries (Bangladesh, Bhutan, Nepal, India, and Sri Lanka) and two Southeast Asian countries (Myanmar and Thailand).

The bloc has been negotiating a proposed Free Trade Agreement (FTA) since 2004.

So far over 20 rounds of talks have been held. The last one was held in 2018.

"I would like to raise a few fundamental issues about where we stand and what are the possibilities of making this FTA a reality," Goyal said here at CIIs BIMSTEC Business Summit 2024.

He said that so far 22 rounds of talks have been held for the agreement and this itself raises a question on whether "we need to pause and have a relook at the track where we are going".

The last round of negotiations took place some six years ago, which means something is holding back this FTA.

The reasons for slow progress can be the non-trade barriers or trade barriers coming in the way of normal trade, he said adding the possible impact of other regional FTAs on the BIMSTEC region could be the cause of the delay.

"It could be the trade practices or current trade relationships that could be a reason for this FTA not taking place," the minister said.

He also asked the business leaders of the seven countries to think whether they need this agreement.

The minister further suggested the member nations to consider trade in local currencies to balance out trade imbalances.

"I would urge business leaders also to give honest feedback of what you feel about the potential BIMSTEC FTA. Do you see merit in it, Do you see value in it," he said Feedback from the business community would help the political leaders to take a decision on this.

He asked the CII to take the lead and discuss about the proposed pact and come out with their recommendations by next year's Summit.

"Maybe, we can begin with a PTA (preferential trade agreement) if not a full flown FTA...But let's examine the realistic possibility and move forward on a fast track basis," he said.

Representatives from the member countries including Sri Lanka, Myanmar and, Thailand talked about the early conclusion of FTA negotiations as it would help boost trade and investments in the region.

Overall, India's total trade with BIMSTEC countries amounted to USD 44.32 billion in 2023-24.

On Bangladesh, Goyal said, "We are all deeply concerned about the evolving situation in Bangladesh and we wish the people of Bangladesh well and we will convey our best wishes for a smooth transition and bright future for the people of Bangladesh".