RESTRICTED  WORLD TRADE  
ORGANIZATION  WT/COMTD/RTA/M/2 
4 August 2009 
 
 (09-3771) 
Committee on Trade and Development  
Second Dedicated Session on Regional Trade Agreements  
 
 
 
NOTE ON THE MEETING OF 15 JULY 2009 
 
Chairman:  H. E. Shree B.C. Servansing (Mauritius) 
  
A.
 ADOPTION OF THE AGENDA .........................................................................................................1  
B. CONSIDERATION OF REGIONAL TRADE AGREEMENTS .................................................................1  
(i) Status of the work of the Dedicated Session – report by the Chairman......................................1  
(ii) Free Trade Agreement between Pakistan and Sri Lanka (Goods) ( WT/COMTD/N/27 , 
WT/COMTD/RTA/2/1 , WT/COMTD/RTA/2/2 ) .................................................................................2  
C. OTHER BUSINESS .........................................................................................................................4  
 
 A. 
ADOPTION OF THE AGENDA  
1. The draft agenda as contained in Airgram WTO/AIR/3398 of 1 July 2009 was adopted .  
B. CONSIDERATION OF REGIONAL TRADE AGREEMENTS  
(i) Status of the work of the Dedicated Session – report by the Chairman 
2. The Chairman  said that he wished to provide Members with an update on the regional trade 
agreements (RTAs) notified under the Enabling Clause that were to be considered in the Dedicated 
Sessions on RTAs of the Committee on Trade and Development (CTD).  
3. He informed the Committee that the Goods aspects of the Pakistan -Malaysia Agreement 
would be considered at the 3rd Dedicated Session in September 2009.  This Dedicated Session would 
be held back-to-back with a meeting of the Co mmittee on Regional Trade Agreements (CRTA), at 
which the Services aspects of the Agreement woul d be considered.  The Factual Presentation on the 
Pakistan-Malaysia Agreement was circulated  with the symbols WT/COMTD/RTA/3/1 and 
WT/REG265/1 on 30 June 2009.  Members had been i nvited to submit to the Secretariat any written 
questions on the Agreement by 30 July 2009.  The Ch ile-India Agreement would be considered at the 
CTD's 4th Dedicated Session, which was tentatively schedul ed to be held back-to-back with the last 
Regular CTD meeting of 2009.  With regard to the preparation of the Factual Presentation on the 
Chile-India Agreement, he said that the Secretariat had received all of the data requested from Chile 
but was still waiting for some data from India.  As  soon as the data were received and processed, the 
Secretariat would send out the draft Factual Presentation to the Parties for comments within a four 
week period.  If the Secretariat received the outstanding data soon, it was envisaged that the Factual 
Presentation would be circulated to Members by 24 September 2009 at the latest.  
4. He also recalled that he had previously men tioned that there were three RTAs involving non-
WTO Members that had been notified under the Enab ling Clause, and that these would need to be WT/COMTD/RTA/M/2 
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  considered by the CTD meeting in Dedicated Sessi on.  The three RTAs were  the South Asian Free 
Trade Agreement (SAFTA), the India-Bhutan Ag reement and the Pacific Island Countries Trade 
Agreement (PICTA).  With regard to the consid eration of these Agreements, the Secretariat had 
requested data from all the Parties involved by 10  August 2009.  It was envisaged that the three 
Agreements could be considered in a Dedicated Session of the CTD in May 2010. 
5. The Committee took note
 of the Chairman's report. 
(ii) Free Trade Agreement between Pakistan and Sri Lanka (Goods) ( WT/COMTD/N/27 , 
WT/COMTD/RTA/2/1 , WT/COMTD/RTA/2/2 )  
6. The Chairman  said that the Pakistan-Sri Lanka Free Trade Agreement (PSFTA), which 
entered into force on 12 June 2005, had been notifie d to the WTO on 11 June 2008.  The notification, 
contained in document WT/COMTD/N/27, had been  made under paragraph 4(a) of the Enabling 
Clause.  The text of the Agreement, together with its Annexes, was available on the Parties' official 
websites.  The Factual Presentation on the Agreement – circulated as document WT/COMTD/RTA/2/1 on 21 April 2009 – had been prepared by the Secretariat on its own responsibility in full consultation with the Partie s, in accordance with paragraph 7(b) of the 
Transparency Mechanism for RTAs.  Written ques tions and replies on the Agreement had been 
circulated in document WT/COMTD/RTA/2/2 on 23 June 2009.  He proposed to organize the consideration of the Agreement by giving the Parties,  and then Members, the opportunity to provide 
any general comments.  Members would then turn to  the specifics of the Agreement using the Factual 
Presentation to guide the debate, after which they wo uld consider the questions and replies document.  
The Parties would subsequently have the opportunity  to respond to any questions raised during the 
meeting, and to make any final comments.   
7. The representative of Sri Lanka, on behalf of the Parties
, said that the PSFTA came into 
operation in 2005 with the objective of further developing and enhancing the trade and economic 
relationship between Pakistan and Sri Lanka.  The Pa rties firmly believed in the principle of, and the 
distinct merits associated with, a fair and rule -based trade regime achieved through the multilateral 
path. Being among the founders of the GATT and s ubsequently of the WTO, the Parties were 
committed to a fair and rule-based multilateral trading system.  They also supported the complementary nature of bilateral and regional e ngagement, and had engage d in the liberalization 
process within these frameworks as well.   The Parties' objective in engaging in RTAs was to facilitate 
and enhance their engagement at the multilateral le vel.  They believed that RTAs were building 
blocks to the multilateral trading system. 
8. He said that the PSFTA covered substantial levels  of trade in both agricultural and industrial 
goods. Pakistan had completed its trade liberali zation programme in March 2009, while Sri Lanka 
would eliminate tariffs under the Agreement by 2010.  Since the implementation of the PSFTA, 
Pakistan had become Sri Lanka's second largest trad ing partner in the South Asian region.  The value 
of total trade between the two countries had increased from US$159 million in 2005 when the 
Agreement came into effect, to US$270 million in 2008.  This was a substantial enhancement of the 
trade turnover between the two countries.  Benef iting from the concessionary access available through 
the PSFTA, Sri Lanka’s exports to Pakistan  had increased from US$43 million in 2005 to 
US$70 million in 2008.  At the end of the implem entation of the PSFTA by Sri Lanka, Pakistan 
would enjoy duty-free access on 82.2 per cent of all tariff lines, with 70.2 per cent of agricultural products and 80.2 per cent of non-agricultural products  receiving duty-free treatment.  Similarly, at 
the end of the implementation, Sri Lanka would en joy duty-free treatment on 88.6 per cent of all tariff 
lines, composed of 90.8 per cent of agricultural prod ucts and 88 per cent of non-agricultural products.   
9. According to Sri Lanka's 2008 trade statistics, of the country's top 25 export items to 
Pakistan, 11 qualified for duty-free treatment a nd nine for concessionary treatment under the  WT/COMTD/RTA/M/2 
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  Agreement.  With regard to the product profile of  exports from Sri Lanka to Pakistan, it had been 
observed that rural-based agricultural products pr oduced by small-scale subsistence farmers had 
received tariff concessions.  Some of the Sri La nkan products which had bene fited from market access 
included betel leaves, areca nuts, coconut products , spices and vegetables.  Opportunities were also 
presented under the Agreement for Sri Lanka to diversif y out of its traditional exports to Pakistan into 
such areas as mineral products, fibre boards, footw ear, gem and jewellery, copper products, electrical 
appliances, printed circuits and bicycles.  In a ddition, studies by Sri Lankan trade policy practitioners 
had revealed that Sri Lanka would be able to access  the Pakistani tea and apparel markets after the full 
implementation of concessionary tariffs under the Agreement. 
10. He next referred to the rules of origin (ROO) under the Agreement.  He said that Pakistan and 
Sri Lanka, both developing countries heavily dependent on international trade, could only realize their  
trade and development aspirations through preferentia l arrangements if the ROO were relaxed, simple 
and flexible.  Under the PSFTA, 65 per cent of third-pa rty materials were allowed, subject to change 
of tariff headings at the six-digit level.  Bilateral cumulation had also been provided for in the Agreement.  With respect to pros pects for the further enhancement of current arrangements, he said 
that both countries were keen to expand the cove rage of the Agreement to include services and 
investment sectors.  Two rounds of  negotiations had already been conc luded with a view to expanding 
the current arrangements into a comprehe nsive economic partnership agreement.  
11. The representative of the European Communities
 said that the PSFTA had the potential to 
increase bilateral trade between the Parties.  Sri Lanka could, for example, increase its exports to 
Pakistan and overcome its current bilateral trade defi cit.  She said that, in their written responses, the 
Parties had not given a clear indication as to whethe r they intended to further improve the coverage 
under the Agreement.  In particular, they had on ly stated that they would engage in further 
negotiations taking into considera tion each others' concerns.  The EC asked for more clarity as to 
whether the Parties were considering extending the c overage in order to include most of the products 
traded between them, and for an indication as to when this might happen.  She also referred to 
Table II.4 of the Factual Presentation, which listed Sr i Lanka's and Pakistan's participation in other 
RTAs, as of February 2009.  She observed that Paki stan had not yet notified two of its RTAs, namely 
those with Mauritius and Iran.  The EC asked for an  explanation from Pakistan as to why these RTAs 
had not yet been notified.  
12. The representative of the United States  referred to the Parties' response to question 10 in the 
questions and replies document.  She expressed appr eciation for the clarification that the entire WTO 
Agreement on Sanitary and Phytosanitary Measures (SPS)  – and not just Article 2 – was  incorporated 
in the PSFTA.  The US requested that paragraph 42 of the Factual Presentation be revised to reflect 
the Parties' response.  She also indicated her dele gation's interest in the Parties' responses to the 
questions posed by the EC at the present meeting.   
13. The representative of Japan  referred to question 6(ii) in the questions and replies document. 
The question – posed by the EC – was whether th e agreement on cooperation and mutual assistance 
on customs matters between Pakistan and Sri Lanka  would cover trade facilitation issues. While the 
Parties had responded in the affirmative, Japan wi shed to know the context of the trade facilitation 
elements in this agreement.   
14. In response to the EC's question as to whethe r the Parties intended to further extend the 
product coverage of the PSFTA, the representative of Pakistan  said that the intention was to review 
the current arrangements after they had been fully  implemented, with a view to broadening the 
coverage.  While there was presently no time-frame or set date as to when this would happen, he 
noted that the Parties engaged frequently with each other.  On the second question by the EC 
concerning the non-notification of Pakistan's RTAs with Mauritius and Iran, he said that he did not 
have the necessary information to respond at the presen t meeting.  He would, however, consult with WT/COMTD/RTA/M/2 
Page 4  
 
  his capital and provide a response as soon as possible.  He next referred to the US' intervention, and 
confirmed that the Parties subscribed to the SPS Agr eement in its entirety.  Finally, on the question by 
Japan, he said that trade facilitation was an integral part of the deliberations of the Working Group on 
Customs Cooperation.  He invited Japan to submit any specific questions on the matter, which the Parties would submit to their capitals for responses. 
15. The representative of the United States
 clarified that her delegation had not posed a follow-up 
question with regard to the PSFTA's incorporation of  the SPS Agreement.  Rather, the US appreciated 
the response that had been provided by the Parties in the questions and replies document, and wished 
to ensure that the Factual Presentation w as revised to reflect the response.   
16. The Chairman  said that the CTD's consideration of the PSFTA had allowed Members to 
clarify a number of questions.  Oral discussion of  the Agreement could be concluded in accordance 
with paragraph 11 of the Transparency Mechanism fo r RTAs.  Further questions by delegations on the 
agreement were to be submitted in writing to the Se cretariat within one week, by 22 July 2009.  The 
Parties would then be given two weeks to submit thei r written replies, by no later than 5 August 2009. 
In accordance with paragraph 13 of the Transpar ency Mechanism, all written submissions as well as 
the minutes of the meeting would be circulated pr omptly in all WTO languages, and would be made 
available on the WTO website. 
17. The Committee took note  of all interventions.   
C. OTHER BUSINESS  
18. No matter was raised under "Other Business". 
19. The meeting was adjourned . 
 
 
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