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The South Asian Free Trade Agreement, commonly known as SAFTA, is an agreement signed between member countries of the South Asian Association for Regional Cooperation (SAARC). The agreement aimed to promote trade and economic cooperation among the member nations by reducing trade barriers and promoting mutual trade.

The SAFTA agreement was signed on January 6, 2004, in Islamabad, Pakistan, during the 12th SAARC Summit. The countries that signed the agreement include Afghanistan, Bangladesh, Bhutan, India, the Maldives, Nepal, Pakistan, and Sri Lanka.

The agreement came into effect on January 1, 2006, after the ratification by all member states. Under the SAFTA agreement, member nations agreed to reduce their tariffs gradually and eliminate non-tariff barriers on traded goods. The agreement also included provisions for the protection of intellectual property rights and the settlement of disputes.

The SAFTA agreement was a significant step towards regional economic integration among South Asian nations. The agreement aimed to create a free-trade area to boost intra-regional trade, which was significantly low at the time. The agreement was expected to increase trade among member nations by reducing trade barriers and promoting economic cooperation.

However, the implementation of the agreement faced several challenges, including a lack of political will and infrastructure constraints. Despite these challenges, the SAFTA agreement has been successful in promoting trade among member countries. In the past few years, intra-regional trade among SAARC nations has increased significantly.

In conclusion, the SAFTA agreement was signed on January 6, 2004, in Islamabad, Pakistan. The agreement came into effect on January 1, 2006, after the ratification by all member states. The agreement aimed to promote trade and economic cooperation among member nations by reducing trade barriers and promoting mutual trade. Though the implementation of the agreement faced several challenges, it has been successful in boosting intra-regional trade among SAARC nations.