Sri Lankan power producers told of Pakistan prospects

Gibbs · Apr 5, 2015

Sri Lankan power producers told of Pakistan prospects | Economynext

COLOMBO (EconomyNext) - Private power producers in Sri Lanka have been asked to invest in developing electricity generating plants in Pakistan which suffers from a severe energy shortage with regular power cuts.

"There's a lot of potential in Pakistan for investment in power generation," said Hazan Ali Zaigam, First Secretary, High Commission of Pakistan in Sri Lanka.

"We know Sri Lankan companies are experienced in mini-hydro power development."

Regular power shortages in Pakistan have created serious problems for Pakistan's trade and industry.

"Pakistan offers upfront tariffs and private power purchase agreements for 20 years," Hazan Ali Zaigam told a forum on free trade deals organised by the Ceylon Chamber of Commerce.

"There are many foreign companies coming into Pakistan."

Hazan Ali Zaigam said Pakistani firms particularly in the sugar, cement and pharmaceutical sectors were looking at Sri Lanka for investments.

He said that while the Sri Lanka-Pakistan free trade deal had opened up markets for companies in both countries covering 5,000 products not enough of it was used.

"Pakistan aspires to be the economic corridor between South Asia, West Asia and Central Asia," he said.

Gibbs · Apr 9, 2015

Pakistan willing to ink CEPA with Sri Lanka | Business Recorder

Pakistan has expressed its intention to ink first Comprehensive Economic Partnership Agreement (CEPA) with Sri Lanka, keeping in view that the latter was the first country with which FTA was signed. Islamabad conveyed its intention during the recent visit of Sri Lankan President Maithripala Sirisena.

Well-informed sources in Commerce Ministry told Business Recorder that Pakistan has made the same offer to Sri Lanka as it made to Turkey. "Our offer was that Pakistan and Sri Lanka should move forward from FTA to CEPA aimed at enhancing trade and economic relations", sources revealed.

For instance, Free Trade Agreement (FTA) between Pakistan and Sri Lanka was signed ten years ago but Sri Lanka still imposes tariff quota on Pakistani rice. Pakistan maintains that quota on rice should be removed if Sri Lanka is implementing the FTA according to its spirit. In the CEPA, both countries will eliminate quotas bilaterally and deliberations will be held on customs co-operation, investment and widening and deepening of tariff cuts.

The two countries held the first round of talks on CEPA in October 2014 in Colombo and next round will be held in September 2015 in Islamabad. Joint Working Groups (JWGs) have already formulated proposals on different sectors and would finalise their recommendations.

Sri Lankan President Sirisena and Prime Minister Sharif have agreed to expedite the process to reach early agreement on CEPA. The import of auto parts from Sri Lanka and rice exports from Pakistan are the two key issues. Pakistan unilaterally imposed restriction on import of auto parts from Sri Lanka after Pakistani industry revealed that Indian parts are reaching Pakistan through Sri Lanka.

According to sources, Commerce Minister Khurram Dastgir raised the issue during the Sri Lankan President's visit noting that South Asians habitually haggle which amused the Sri Lanka President. Commerce Minister maintained that the two countries should not haggle.

According to data Pakistan's exports to Sri Lanka increased by nearly 160 per cent compared to pre-FTA exports whereas Sri Lankan exports increased by 89 percent. However, the volume is still too low as present bilateral trade is only $350 million. Pakistan underscored the need for business-to-business interaction which will be structured at the government level and businesspeople of the two countries should participate in exhibitions.

Pakistan complained that Sri Lanka used to grant visas to Pakistani businessmen on arrival, a practice Sri Lanka abandoned which is creating hurdles for Pakistani exporters.