Bangladesh may drop complaint over EU trade preference to Pak textiles

Bangladesh is likely to withdraw a complaint against the European Union move to grant import concessions to textile manufacturers in Pakistan in the wake of the massive flood there last year, a senior Bangladeshi official said today.

Bangladeshi officials said their Pakistani counterparts had 'unofficially' raised the issue of Bangladesh's objection to EU trade preference to Pakistani textile exports on the sidelines of the South Asian leaders' summit in Maldives.

The EU proposal for granting trade preferences for Pakistani textile makers has been hanging fire and a complaint by Bangladesh may halt its approval by trade diplomats meeting in Geneva this week.

EU had granted the preferential import status to Pakistan's textile makers as an aid measure following the devastating floods in the South Asian country last year.

Bangladesh raised concerns over the European measure, which would make it easier for Pakistan to export textiles to Europe as it competes with Pakistan for textiles sales to the European market.

The two-year tariff cut offered by the EU would boost Pakistan's textile exports.

World Trade Organisation rules, however, d3emand that the same deal must be offered to all trade partners, so by making an exception for Pakistan, the EU needs to get all WTO members on side and any single country can block the deal.

Bangladesh, which ranks among the least developed countries, however, enjoys quota- and duty-free access to EU countries.