The South Asian Free Trade Area (SAFTA) agreement came into force on January 1, 2006, as a regional initiative aimed at promoting trade and economic cooperation among the South Asian Association for Regional Cooperation (SAARC) countries. The agreement was signed in 2004 during the 12th SAARC Summit in Islamabad, Pakistan, by the member countries.
The SAFTA agreement seeks to create a level playing field for trade among the member countries by reducing or eliminating trade barriers, including customs duties, quantitative restrictions, and non-tariff barriers. It aims to promote cross-border investments, enhance regional connectivity, and foster harmonious economic relations among the member countries.
The SAFTA agreement covers all goods, services, and investment. Under the agreement, the member countries have agreed to progressively reduce and eliminate customs duties on 90% of their traded goods within a period of 10 years. They have also agreed to liberalize their trade in services, including business services, communication services, construction and related engineering services, distribution services, tourism and travel-related services, and transportation services.
In addition to the trade liberalization measures, the SAFTA agreement also contains provisions for dispute resolution and safeguard measures. It establishes a dispute settlement mechanism to resolve any disputes that may arise between member countries regarding the interpretation or implementation of the agreement. It also provides for safeguard measures to protect the member countries` industries from sudden surges in imports that could cause serious injury to the domestic industry.
The SAFTA agreement is a significant milestone in the economic integration and regional cooperation process of the SAARC countries. It has the potential to increase trade and investment flows among the member countries, leading to economic growth and development. However, the full realization of the agreement`s benefits will depend on the effective implementation of its provisions by the member countries.
In conclusion, the SAFTA agreement came into force on January 1, 2006, with the objective of promoting trade and economic cooperation among the SAARC countries. It is a comprehensive agreement covering all goods, services, and investments, and includes provisions for dispute settlement and safeguard measures. The agreement has the potential to increase regional trade and investment and foster harmonious economic relations among the member countries. As an SEO copy editor, it is important to include relevant keywords in the article, such as “SAFTA agreement,” “SAARC countries,” “regional cooperation,” and “trade liberalization.”