Thursday, December 29 2005 12:37 Hrs (IST) - World Time -

New Delhi: The Union Cabinet today (Dec 29, 2005) approved the South Asia Free Trade Agreement, Commerce Minister Kamal Nath said.

"The Cabinet has approved SAFTA, which comes into effect from January 1, 2006," he told reporters after a meeting of the Cabinet here.

He said the agreement provides for a special dispensation to Leased Developed Countries within the SAFTA region, who will be compensated for the revenue loss on account of duty reduction.