Trade pact with South Africa Customs Union by next year
November, 17th 2011
So far, eight round of negotiations have taken place.
India is expected to sign the much-awaited preferential trade agreement (PTA) with South Africa Customs Union (SACU) by the first quarter of 2012, as both sides are currently engaged in active negotiations on seeking greater access of each others markets and easier movement of professionals.
SACU consists of Botswana, Lesotho, Namibia, South Africa and Swaziland. Since 2007, negotiations have been on over having a PTA with the grouping. So far, around eight rounds of negotiations have taken place. When you negotiate, there is always the aspect of give and take, said South African Deputy Minister for Trade and Industry Elizabeth Thabethe. It has to be mutually beneficial for both the sides, taking care of sensitivities on each side. Every country within the union has its own set of demands. We are discussing that. We hope to reach an agreement by the first quarter of 2012 or the second quarter, she told Business Standard.
Thabethe, who is in India to take part in the India International Trade Fair that began here on November 14, also said the next round of negotiations would take place soon. The progress, so far, has been considerable. However, she highlighted that the PTA should yield a win-win situation for both sides and boost bilateral trade and investment.
Under a PTA, the negotiating countries reduce their tariffs on a particular number of products from the level they maintain with countries that are not parties to the pact. Unlike free trade agreements (FTAs), a PTA does not slash or eliminate duties from a large number of tariff lines.
Earlier this year, Minister for Commerce and Industry and Textiles Anand Sharma had indicated that the PTA would initially result in tariff cuts on a specific number of products.
It could be expanded into an free trade agreement (FTA) depending on the progress of the PTA, he had indicated during the visit of South Africas Trade Minister Rob Davies. Since then, both sides are also discussing a bilateral investment promotion and protection agreement.
Thabethe is to hold a bilateral meeting with Jyotiraditya Scindia, minister of state for commerce and industry.
Both countries have earlier set the target of achieving $15 billion worth of bilateral trade by 2014 from around the present $11.12 billion. Thabethe said this target was attainable with greater cooperation in the small and medium sector, information technology, infrastructure, rural development and handicrafts.