Relation is most liberal and oldest free trade agreement, say officials from both sides

Commerce: With the ferro silicon industries facing stiff competition from those in China and Vietnam, the government has requested the Indian government to provide preference to Bhutanese ferro silicon.

This was one of the discussion points tabled during the Indo-Bhutan trade and transit meeting yesterday in Thimphu.

Economic affairs’ officiating secretary, Sonam P Wangdi ,who led the Bhutanese delegation, said the Indian counterparts agreed to study the matter, including the taxation procedures.

The Bhutanese delegation, he said, also requested to allow all agricultural products be imported by air, as those that are allowed by road.

The meeting also saw most of the pending issues being resolved.

For instance, the officiating secretary said that contract for the access road from Pasakha industrial estate through Bulan Chaupati to Khogla in the bordering Indian town of Jaigaon bypassing the Phuentsholing town has been awarded.

Bhutan also requested the Indian delegation to expedite the work on Bokajuli-Motanga access road connecting Samdrupjongkhar and Assam, bypassing the Samdrupjongkhar town.

“Direct access to these two industrial estates will not only reduce the cost of transportation but also reduce congestion and pollution in the towns,” Sonam P Wangdi said.

However, he said that India would approve these transits, provided necessary infrastructure was laid.

On the other two permanent entry and exit points – Dalmore connecting West Bengal and Gomtu and Rangapani connecting Assam and Nganglam – he said the Indian counterpart agreed to look into the possibility.

In the last meeting held in January last year, Bhutan requested seven season entry/exit points.  The Indian delegation informed that three points, Loksan and Nagarkata bordering Samtse and Kulkuli bordering Lhamoizingkha have been approved.

For the remaining four, Sonam P Wangdi said Indian delegates announced two as currently not feasible, while it was yet to explore the possibility for the other two.

On the railway siding for gypsum and potatoes export to Nepal, Bhutan in the last meeting had requested for three more additional railway points, since the point at Raxual in India was already congested.

The Indian delegation has agreed to explore the possibility of railway point in Nautanwa in Utter Pradesh.

India’s commerce secretary, Rajiv Kher, said while India has a special focus on trade ties with the south Asian region, Bhutan was on a higher pedestal. “Bilateral trade with Bhutan is something that shines as a jewel in the region,” Rajiv Kher said. “Indo-Bhutan trade transcends typical diplomatic relations.”

But this meeting, he said, was intended to remove “irritants” from the relationship and create a value chain in trade between the two countries.

He offered India’s support in Bhutan’s green sectors like information technology.  Bhutan’s strong focus on English language and encouraging educated work force, he said, was strength in itself. “India can do anything to contribute to these sectors,” he said, in reference to environmentally friendly sectors.

India has also offered assistance in solar water pumping system to boost agriculture productivity, which the Bhutanese counterparts welcomed.

The Indian delegation also tabled a discussion on having trade and services agreement. Sonam P Wangdi, however, said that Bhutan’s FDI policy and SAARC trade and services agreement would encompass the needs.

Yesterday’s meeting also held talks on renewal of the trade agreement, which expires on July 2016.  Both sides, he said would work on it for six months and then finalise the agreement. “But the validity of the agreement would be longer this time,” he assured.

Sonam P Wangdi also raised concerns on the trade deficit with India that grew by 467 percent since 2005 until last year.

Bhutan, he said is also working on 27 entry and exit points via air, sea and land for trade with third countries since the agreement provides transit provisions for Bhutan with third countries through India, whenever needed.

By Tshering Dorji