India and Bhutan mutually decided to bring into force the 'new' bilateral Agreement on Trade, Commerce and Transit with effect from this July 29, an official statement said on Monday. The new agreement will further strengthen the bilateral trade relations between India and Bhutan, it said.
The agreement provides for a free trade regime between the territories of India and Bhutan. The agreement also provides for duty-free transit of Bhutanese merchandise for trade with third countries. It was last renewed on July 29, 2006 for ten years. The validity of this agreement was extended (with effect from July 29, 2016) for one year or till the new agreement comes into force, through exchange of diplomatic notes.
The new agreement was signed on November 12, 2016, and as per its provisions, the pact was to come into force on a mutually decided date.
