South Asian Free Trade Area

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South Asian Free Trade Area
Countries under the South Asian Free Trade Area
Member states	Afghanistan  Bangladesh  Bhutan  India  Maldives  Nepal  Pakistan  Sri Lanka
Establishment	2006
• Location	12th SAARC summit, Islamabad, Pakistan
• Date	6 January 2004
• In force	1 January 2006

The South Asian Free Trade Area (SAFTA) is a 2004 agreement that created a free-trade area of 1.6 billion people in Afghanistan, Bangladesh, Bhutan, India, the Maldives, Nepal, Pakistan and Sri Lanka with the vision of increasing economic cooperation and integration.^[1]

One of the major goals was to reduce customs duties of all traded goods to zero by 2016. SAFTA required the developing countries in South Asia (India, Pakistan and Sri Lanka) to bring their duties down to 20 percent in the first phase of the two-year period ending in 2007. In the final five-year phase ending in 2012, the 20-percent duty was reduced to zero in a series of annual cuts. The least developed countries in the region had an additional three years to reduce tariffs to zero. India and Pakistan ratified the treaty in 2009, whereas Afghanistan, as the eighth member state of the SAARC, ratified the SAFTA protocol on 4 May 2011.^[2]