India has put forward proposal to speed up free trade agreement (FTA) with Bangladesh in order to solve the trade deficit issue which was being repeatedly asked for by Dhaka.
FTA between India and Sri Lanka has been beneficial to both countries, said Indian Commerce and Industry Minister Kamal Nath.
The trade deficit issue can be solved by having an FTA which can also include Safta.
Sri Lankan exports to India went up to $200 million from just $45 million in 2001 before FTA, he informed.
The balance of trade after FTA was signed has come down to 1:4 at present which earlier favoured India 15:1 before FTA, Nath said.
The Indian Commerce Minister put forward a proposal for a commercial motor vehicles agreement for seamless transport between the two countries.
This would allow trucks from both sides to enter each other's territory, a practice being followed in European Union and Asean.
Nath said containerized movement of goods through riverine route, land route and railways would reduce congestion at Petrapole-Benapole station resulting in faster goods movement.
Container between Kolkata and Dhaka via Singapore costs 2,500 dollars taking over 15 days but riverine transportation will cost only 500 dollars taking just five days, he said.
Nath suggested declaring Ashuganj a port of call under the bilateral Inland Water Trade and Transit Protocol with multi modal facilities.
He said with the implementation of Safta in July this year and India's offering of Tariff-rate quota (TRQ) would ensure increase in Bangladesh's exports to India.
Regarding trade gap issue, almost 70 percent of India's exports to Bangladesh consists of yarn, chemicals, petroleum products and construction materials or basic items such as rice, wheat, sugar which fulfills the essential demands of the people of Bangladesh and adds to Dhaka's export and manufacturing competitiveness, he said.
Nath said that Bangladesh's exports to India in last four years had tripled and surpassed Bangladesh's overall export growth rate of 14 percent.
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