“This raises the issue of violation of human rights of the workers (viz, access to livelihood),’ he said. Further, he added that their prospects were bleak particularly because of competition from China. .
Speaking about steps Sri Lanka would be able to take in two years that it could not take during the ten-year scheduled phase-out of the MFA, Fernandopulle said, “We will try to get into a free trade agreement (FTA) with the U.S.’According to him, Lanka exported 80 percent of textiles to the U.S. market. Besides, European Union (EU) was second biggest exports market for the country. The country was awaiting response from either the U.S. or the EU to the request for extension of the MFA (which has to end on December 31, 2005, in terms of the 1994 Agreement on Textiles and Clothing of GATT/WTO). .
The minister termed the FTA in operation between the two countries for the past four years as a “fair” arrangement leading to growth of exports of his country. Investors, including some Indian companies, were using Sri Lanka as a manufacturing base to access the Indian market with the FTA tariff concession, and also the lower value addition norm of 25 percent (against the minimum of 35 percent otherwise) in the case of products that use raw material originating in either country. On the downside, however, Sri Lankan exporters were said to be facing discriminatory sales tax on imports in India, especially Tamil Nadu, difficult Indian customs procedures, restriction of imports to specific ports and corruption. Sri Lanka had utilised only one per cent of its permissible level of export of textiles to India under the FTA. .
Sri Lanka was preparing a law to enable levy of punitive duty on dumped imports, he said.