India signs new free trade pact with Bhutan

New Delhi: The commerce ministry has said the new agreement on trade, commerce and transit between India and Bhutan has come into force from July 29, a move which will further strengthen economic ties between the two countries.

The agreement provides for a free trade regime between the countries and it also gives duty free transit of Bhutanese goods for trade with third countries, the commerce ministry said in a statement.

The bilateral trade relations between India and Bhutan are governed by this pact.

The pact was last renewed on July 29, 2016 for a period of ten years. Its validity was extended for one year or till the new agreement comes into force.

"As agreed to by both India and Bhutan, the new agreement has come into force with effect from 29 July, 2017. The new agreement will further strengthen the bilateral trade relations," it said.

The two-way trade stood at USD 808.72 million in 2016-17, up from USD 750.2 million in the previous fiscal.

In a separate statement, the ministry said to facilitate movement of cargo across the border, India and Bangladesh have agreed to operate Petrapole-Benapole integrated check post (ICP) 24x7, with effect from Tuesday.

This post is a major route for bilateral trade. The ministry said that Land Ports Authority of India and Central Board of Excise and Customs have issued necessary instructions in this regard. "The 24x7 operationalisation of Petrapole-Benapole ICP is expected to be a significant milestone towards expeditious clearance of cargo and, hence boost the bilateral trade between the countries," it added.

The bilateral trade between the countries has increased to USD 7.43 billion in 2016-17 from USD 6.76 billion in the previous fiscal.