• Trade Secy says no date fixed for next ETCA round despite earlier public declarations
• US tariff escalation and India-Pakistan tensions push ETCA off immediate agenda
• Cabinet must first reach consensus before trade talks resume: Deputy Minister
• ETCA follows long-stalled CEPA talks; both agreements yet to materialise

Considering recent global developments, the proposed Economic and Technology Cooperation Agreement (ETCA) is not an immediate priority for either Sri Lanka or India, according to the Ministry of Trade, Commerce, Food Security, and Cooperative Development.

Speaking to The Sunday Morning Business, Ministry of Trade, Commerce, Food Security, and Cooperative Development Secretary K.A. Vimalenthirarajah stated that despite recent public declarations made by the heads of Government of both nations asserting the intention to recommence talks with regard to ETCA, both sides were yet to fix a date for the next round of talks.

He further stated that the recent imposition of 44% reciprocal tariffs by the US on Sri Lanka and the outbreak of war between India and Pakistan had pushed ETCA down the list of immediate priorities for both countries.

“India is now focusing on something else right now [the war with Pakistan]. We are focusing on the US reciprocal tariffs. We cannot comment on the Indian side, but on our side, our immediate priority is something else,” he stated.

However, speaking to The Sunday Morning Business, Deputy Minister of Trade, Commerce, and Food Security R.M. Jayawardana stated that while talks between both nations with regard to ETCA must commence soon, the Cabinet of Ministers must come to a consensus and approve the commencement of such trade negotiations prior to that.

“We have to discuss this in the Cabinet and reach a decision. We are hopeful of reaching a consensus in the Cabinet with regard to this under the existing circumstance,” he stated. 

Jayawardana added that it was possible that this subject would be taken up and discussed at this week’s Cabinet meeting. 

Sri Lanka’s first bilateral Free Trade Agreement (FTA) was the India-Sri Lanka Free Trade Agreement (ISFTA), signed in 1998 and operational since 2000.

In 2005, both countries attempted to upgrade the ISFTA through the Comprehensive Economic Partnership Agreement (CEPA), which would have covered services, investment, and greater cooperation. However, political resistance in Sri Lanka, largely rooted in fears of labour inflows, halted progress and CEPA remained unsigned.

Its successor, ETCA, has also stalled despite numerous rounds of talks.