COLOMBO: Pakistan’s removal of a quota on Sri Lankan betel leaf exports has helped raise the quality of life among growers in three of the island’s districts, a government minister said. The government is keen to ensure that the benefits of the island’s burgeoning exports flow down to the villages in order to ensure social equality, trade minister G L Peiris said.
Trade between Sri Lanka and Pakistan had doubled since a free trade deal was signed between them, he told the opening of the three-day Pakistan Trade Exhibition. During trade talks in Islamabad, Pakistan agreed to remove the ceiling of 1,400 tonnes a year on the export of Sri Lankan betel leaves.
The move helped uplift the quality of life in the districts of Kurunegala, Kegalle and Gampaha where the leaf is grown. “This brought about an economic renaissance at the social level in these three districts,” Peiris said. He said he appreciated Pakistan’s willingness to not only enhance the volume of trade between the two countries and foreign exchange earnings for the island but to support ways in which the benefits of exports trickle down to rural Sri Lanka.
“We see our export policy as a means of bringing social equality to Sri Lanka. That’s why we’re setting up export promotion villages. These are very effective, powerful levers as elements of government strategy to bring about equality.” Pakistan’s decision to remove the export of herbal products from the negative list of the FTA under which no tariff concessions are given also helped rural communities which grow the herbs that go into the products.
“Today people are moving away from antibiotics to herbal remedies. That too administered a powerful impetus to Sri Lanka’s economy, particularly the rural economy.” Further talks with Pakistan are aimed at broad-basing the free trade deal to include services and investments, Peiris said.
Sri Lanka has seen very high inflation close 20 percent in the past two years as unrestrained government expenditure was financed with printed money. Other than the bloated public sector which is estimated to have grown by more than 200,000 in the past three years, and has also got salary increases above inflation, people working in productive sectors have seen their real incomes fall. More than half the tax revenues of the island are spent on government sector salaries and pensions, which are tax free.-SANA