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South Asian Free Trade Area (SAFTA)

Submitted by:
Divyarajsinh Zala (208390593067) Submitted to:
Rosina Shikongo (208390593068) Mr. Naveen Singh
Angela Amado (208390593069) Assistant. Professors
Dhanwani Vanita (208390593070) GSMS, GTU
2 TABLE OF CONTENT

1. Introduction
2. Basic principles underlying the SAFTA
3. Instruments involved in the SAFTA
4. Trade with Nepal
5. Trade with Afghanistan (Taliban effect)
6. References
3 SOUTH ASIAN FREE TRADE AREA (SAFTA)

• Meaning

It refers to the agreement On south Asian Free

Trade Area.
• It Includes

Seven countries in this agreement

• Objective

To create a free trade area

4 BASIC PRINCIPLES UNDERLYING THE SAFTA

• Reciprocity and mutuality;

• Negotiation of tariff reform;

• Recognition of the special needs of the Least Developed Contracting States;

• Inclusion of all products, manufactures and commodities in their raw, semi-processed and processed
forms
5 INSTRUMENTS INVOLVED IN THE SAFTA

• Trade Liberalization Program

• Rules of origin
• Institutional Arrangements
• Consultation
• Safeguard Measures
• Any other instrument that may be agreed upon
 6 IMPORT OF EDIBLE OIL

• Curb excess import of edible oils from Nepal • Suggestions:

 In Tamil Nadu, Erode has become a major centre for Nepalese  To reduce excess imports from Nepal:
refined sunflower oil, and Chennai is following suit. At these costs,
 SEA advised that the government channel imports through a
it is impossible to compete with them, which will eventually lead
PSU such as NAFED and distribute the oil to the most needy
to the closure of small and medium-sized refineries in the area.
members of society through the Public Distribution System.
 The Solvent Extractors Association of India (SEA) has received
 Reducing import duty: Without lowering overall import duty for
complaints from its members alleging that traders are obtaining
the country, the government would be able to get zero duty oil
finished goods from Nepal and just swapping the stickers before
from Nepal in a much more regulated manner, which can
selling them under their brand at outrageously low costs.
provide relief to the underprivileged.
 The massive influx of soybean oil from Nepal into India, which
 The government should fix the quota for import of refined oils
violates origins restrictions, (is) gravely harming Indian refiners
from Nepal and distribute it month-by-month/region-by-region
and farmers, and (is) costing the government money.
to have the least impact on the domestic refinery industry.
 7 THE EFFECTS OF THE TALIBAN ON SPICE IMPORTS

• Squeeze on Afghan spices and dry fruit imports to strain

India
 In FY21, Afghanistan supplied more than 85 percent of
India's nutritious dry fruit. Similarly, past fiscal year, Kabul
supplied 99 percent of fresh and dried figs in India.
The Taliban has closed two vital land trade ports on the
Pakistan-Afghanistan border. Many of the commodities
imported from Afghanistan are not accessible elsewhere,
and even if they were, they would be imported at a cost if
SAFTA were not in place.
8 CONT..

• Afghanistan supplies 80 percent of India's imported hing, which is of higher quality than Iranian
hing. Although it is presently grown in Tajikistan and Uzbekistan, India does not have trade
agreements with them to benefit from duty exemptions.
• Consumers are the ones who have suffered as prices have risen by 10-15%.Afghanistan's banking
institutions were closed, and there were no customs officers to clear consignments and issue
necessary certifications.
9 REFERENCES

• https://economictimes.indiatimes.com/topic/safta (19/01/2022)

• https://economictimes.indiatimes.com/news/economy/foreign-trade/curb-excess-impor
t-of-edible-oils-from-nepal-trade-body-sea-tells-government/articleshow/83309562.cms
(19/01/2022)

• https://economictimes.indiatimes.com/news/economy/foreign-trade/squeeze-on-afgha
n-spices-dry-fruit-imports-to-pinch-india/articleshow/85548981.cms
(19/01/2022)
Thank You