By Dr. K.M. Wasantha Bandara Courtesy The Island

According to a news item published in The Island on 8th July, the government seems to have plotted the road map to finalize Economic and Technological Cooperation Agreement (ETCA), by 30th October this year. That was based on the consensus reached between the ministers of both countries in India. Just before that, the government of Sri Lanka appointed a high powered committee of 12 experts to justify ECTA in the context of threatened economic opportunities in Europe following Brexit. At the same time a consultative Committee was also appointed by the government to accommodate representatives of members of United Professional Movement who agitated for participatory approach towards formulation of National Trade Policy. But later it was revealed that the so called consultative committee is meant for “putting the house in order” parallel to the negotiation process and the policy framework to be formulated by another group of experts. However the Government Medical officers Association (GMOA) insists that they have proposed a National Commission to be setup to formulate the National Trade Policy and not just a committee of experts. Now the question that is raised in the minds of people with common sense is whether the government is genuinely trying to compromise with vast majority of professionals in the country or as usual, to change the game plan and hoodwink the masses. To find the answer we have to reflect back on the critical aspects of the negotiation process that took place so far since the new government came to power.

Initially the present government intended to start the process of negotiations for Comprehensive Economic Partnership Agreement (CEPA) from where the previous government gave up, owing to the protests by the local industrialists. At that point the Commerce Department of Sri Lanka, in collaboration with Indian counterpart and various other local and overseas advisors had prepared a detailed agreement consisting of 72 A4 pages, labeled as CEPA. As soon as the government declared its intentions, a cross section of professionals, academics and industrialists in the country started agitating against the move which prompted the government to change the game plan. Accordingly the name of the game was changed from CEPA to ETCA. It was obvious that the government was pretending to be responsive to the public outcry and trying to negotiate for a new agreement favorable to Sri Lanka. However the 72 page CEPA document was reduced to 12 pages and labeled as ETCA in which the details were omitted, the main clauses and the headings covering the trade on services were specifically retained.As such the deliberate attempt of the government was very well revealed and it was clear that they were not ready to re negotiate the core issue which is trade in services.

In response to the changes made by the government the opponents insisted that there is no difference as far as the effect is concerned between CEPA and ETCA. They further demanded the provision for trade in services, more specifically the fourth mode or the movement of natural persons to be excluded from the agreement. At that point a certain minister pretended to agree to that and another minister tried to compromise with the promise that movement of natural persons be limited to the fields of information technology and shipping related services. However the minister who is responsible for the international trade came out with another promise that the government would sign only a “Framework Agreement” to facilitate the final agreement at a future date. By which he implied that the government is genuinely trying to continue with the bargaining process until a favorable consensus is reached with India. He also very tactfully agreed with professional groups to initiate a process with the participation of opponents to formulate a trade policy, based on which the final agreement issaid to be re-negotiated.

However when the intellectual dialogue on the ETCFA (Framework Agreement) began to go in depth, it was revealed that the so called “framework” is more of a commitment than the CEPA. It was very well understood that the so called framework agreement is “The agreement” and once it is signed by political leaders, the other schedules and attachments shall be signed or endorsed by the officials.Extremely vague, unrestricted and open ended clauses were included in the framework agreement, making room for anything to be added after the agreement is signed. For example, chapter 4 (Article II) of ETCFA (Framework Agreement) states as “such an agreement shall include but not be limited to the following”. Not only that, ETCFA commits itself to reaffirm our obligations under the General Agreement on Trade-in Services (GATS) which is a multi lateral agreement facilitated by WTO. Under the sector specific and horizontal commitments of GATS, we have committed to open movement of natural persons subject to existing laws of Sri Lanka. As such we have agreed to allow any category of professional or manual workers without any restriction, whereas under the same clause, India has given detailed list of restrictions.

When this danger of having vague and open ended commitments in a form of a framework was highlighted, the government insisted that it has not yet committed itself and there is ample room to discuss further. It was also an indirect assurance that the government is ready to postpone the signing of framework agreement. As expected by some of those who participated in the discussions with the ministry the government was trying to justify the need to enter into a consensus or understanding over a “broad scope of framework” to facilitate a framework agreement on a future date once the negotiations are successful. Although the government pretended that it has engaged in a bargaining process with India it was obvious that the real bargaining took place with those opposed to the agreement and the concepts of so called “framework” and “broad scope” were just tools.

Now there is no doubt that the government is trying to sign a Memorandum of Understanding (MOU) or a joint statement based on the so called “broad scope”, while the negotiations and the bargaining process is carried forward. That MOU or the joint statement will definitely be a binding commitment from the part of Sri Lanka and be a part and parcel of the so called “framework” or final agreement. That is the type of game India played when Indo Lanka peace accord was forced on Sri Lanka.In the broad scope or the list of chapters to be included in the future agreement to be reached at a latter stage, only the 4th chapter is very specific and the rest is more or less conceptual. The chapter 4 deals with trade in services where it is specifically stated that the commitments by Sri Lanka shall be consistent with GATS article V, which is a much bigger commitment than what was committed in CEPA document. So now the intention of the government is very clear. The government in collaboration with India, is buying time until the opponents are dealt with and at the same time gives a firm assurance to India that it is committed to what India is demanding for the last 13 years. According to the said new item in The Island, High Comissioner of India Mr. Asala Weerakoon has said that both parties are looking at a broader scope to be agreed upon. It is obvious that India is worried only about trade in services, more specifically the 4th mode or the movement of natural persons. That is why only the 4th chapter or the clause on trade in service in the proposed broad scope is specific and the rest is more conceptual.

India has waited and been bargaining for 13 years to open the immigration gates for Indians to enter into Sri Lanka in mass scale on unrestricted work permits, instead of illegally engaging in “odd jobs” on tourist visa in limited numbers. That is why India is ready to spend up to 5 billion USD to build “Adams Bridge” to connect India by road and rail to Sri Lanka. Yet India has other well-known geopolitical interest that could be jeopardized if it fails in CEPA or ETCA. The Indian intelligence agency (RAW) knows very well the intensity of unprecedented opposition by professional groups against liberalizing trade-in services and that it cannot be curbed easily by the government. That seems to be the obvious reason as to why India is ready to support Sri Lanka in its hoodwinking game, which guarantees a binding commitment until the public outcry is dealt with and the framework agreement is signed as planned.

As such now those who have opted genuinely to enter into a partnership with the government in the negotiation process should recognize the trap that had been set for them. They should question the government as to why it has committed to reaffirm its commitments on trade-in services under GATS, instead of having more conceptual clauses like in other chapters in the so called broad scope. There is no doubt signing of a MOU or joint statement based on the “broad scope” that is offered will have a same binding effect as if framework agreement is signed. It is also very unlikely that government would appoint a commission to formulate National Trade Policy and entertain public comments for a long period. They will try their best to have a committee with a powerful member who would formulate a policy by “reverse order” to justify the conditions that are already agreed upon.