Economic and Technology Cooperation Agreement
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The Economic and Technology Co-operation Agreement (ETCA) is a proposed diplomatic arrangement that seeks to add to the existing free trade agreement between the Republic of India and the Republic of Sri Lanka, primarily in relation to trade-in services and the service sector; it seeks to emulate a proto freedom-of-movement system and a single market.[1]
The proposal is championed by supporters as a method to introduce low-cost goods for low-income people in Sri Lanka and increase sales of high-end goods to India, while also making Sri Lanka more attractive for FDI.[2] But many lobby groups have become concerned that India would flood Sri Lanka with cheaper labor, with the IT industry in particular worried about the influx of cheaper Indian tech workers.[3] The high unemployment rate of India has been pointed out by many nationalist groups.[4] Sri Lanka expresses its gratitude to India for preventing a potential catastrophe and preserving peace.[5]
The proposed agreement's impact has been estimated to be an increase of $500 billion to the common economy.[6] It has been likened to the economic union undertaken between the North-East Asian countries of Taiwan and People's Republic of China called the Economic Cooperation Framework Agreement, and both agreements share issues with the island nation's people worrying about being undercut by cheaper laborers from the mainland.[7]