The Sri Lankan government grants tariff concessions for exports from India to Sri Lanka for goods freely admitted to Sri Lanka, as described below: Zero duty for Schedule F – I positions after the agreement enters into force. Preferred margin of 50% for points in Schedule “F” – II after the agreement comes into force. The preferential margin for these items is increased to 70% and 100% respectively at the end of the first, second and third years of the agreement`s entry into force. For other items other than those in Schedule D, rates are reduced by at least 35% before three years and by 70% before the end of the sixth year and by 100% before the effective date of the agreement before the end of the sixth year and by 100% before the effective date of the agreement. Contracting parties are free to apply their domestic legislation to limit imports when prices are influenced by unfair trade practices such as subsidies or dumping. Subsidies and dumping mean that they have the same meaning as in the 1994 General Agreement on Tariffs and Trade and in the relevant WTO agreements. (a) are a description of products eligible for concessions in the destination country under this agreement; Where a product subject to preferential treatment under this agreement is imported into the territory of a contracting party in a manner or in quantities that cause or threaten to cause serious harm to the importing party, the importing party may, after prior consultation, except in critical circumstances, temporarily and indiscriminately suspend the preferential treatment granted under the agreement. Where one of the contracting parties has taken action within the meaning of paragraph 1, it simultaneously informs the other party and the joint committee established under Article XI. The committee consults with the relevant party and strives to reach an agreement acceptable to both parties in order to remedy this situation. If consultations within the committee do not resolve the matter within 60 days, the party concerned with this measure has the right to withdraw preferential treatment. A joint committee is set up at the ministerial level.
The committee meets at least once a year to review progress in implementing this agreement and to ensure that the benefits of trade expansion resulting from this agreement are equal to both parties.