Colombo (Agencies): Breaking deadlock over the issue hanging fire for quite some time now, the Sri Lankan government on Thursday decided to renegotiate the Comprehensive Economic Partnership Agreement (CEPA) with India.

An inter agency committee will be set up to prepare a new draft framework for the negotiations, the country’s information department said in a release here.

"The representatives of the India and Sri Lanka Governments which met in November 2010 in Colombo noted the  significant progress made under the Indo-Sri Lanka Free Trade Agreement (ISFTA).

"They reaffirmed the understanding that it would be timely to build on this achievement through a more comprehensive framework of economic cooperation', it said.

Accordingly, Cabinet nod was granted to appoint an Inter-Agency Committee on proposal made by the ministry of industry and commerce.

"The Inter Agency Committee will comprise representatives of the Ministries of Finance, Industry, External Affairs and Economic Development and Departments of Immigration, Civil
Aviation, Board of Investment and the Attorney General" the statement said.

There have been fears in some quarters in Sri Lanka that the proposed CEPA will give India greater advantage in terms of getting professional jobs in the Island Nation besides imbalances (in favour of India) in investment opportunities between the two countries.