New Delhi: Negotiations for the proposed free trade agreement between India and the European Union (EU) are moving on the right track and both sides are making “solid” headway towards a balanced and mutually beneficial deal. Commerce and Industry Minister Piyush Goyal is in Brussels to discuss progress of this trade agreement with European Commissioner for Trade and Economic Security Maros Sefcovic.
Addressing media in Brussels, Sefcovic said that the European Union “deeply” values its partnership with India, and it is committed to take it to the next level by securing a commercially meaningful agreement, which opens up the markets for both goods and services. In today’s climate of global uncertainty, he said, businesses of both regions are looking for opportunity, access and predictability, and that’s what the two are working together to deliver.
“I am very happy to say that we are on the right track, that we are making solid headway towards a balanced, mutually beneficial deal. Our teams know the path forward, and with Minister Goyal, we are staying in a close touch to keep this momentum going, because our shared ambition remains clear. “And therefore, I would conclude by saying, let’s scale this, let’s get this deal done by the end of this year,” Sefcovic added.
Goyal too said that teams of India and the 27-nation bloc had a laborious day negotiating the pact. “We reaffirmed our shared commitment to conclude negotiations by the end of 2025…I think this has been a very, very productive engagement which reflects the strategic importance both sides attached to a modern, balanced and future oriented free trade agreement,” he said.
He added that India sees this partnership as essential to boosting economic resilience and fostering inclusive and sustainable growth in both regions. The momentum that this negotiation has gained and the progress the two sides have made is excellent.
Officials of both sides are meeting for the next round of talks from May 12-16 here to follow up on the productive discussions. “Both…stand committed to resolving the pending issues, along with our teams, in the spirit of mutual respect and pragmatism, so that it is outcome-oriented and commercially meaningful for both sides,” he said, adding, “our goal for the free trade agreement is to have a future-ready agreement that will promote trusted and diversified supply chains and deepen the strategic cooperation between the European Union and India.” Both have given equal focus on both sides to non-tariff barriers along with tariff related issues in the trade talks.
“We are both equally concerned to make the market access very meaningful for both countries, while respecting the sensitivities that our businesses or our economies may have in certain sectors. The agreement once concluded will certainly be a transformative pillar of the deep partnership between the European Union and India, enhancing market access, aligning our regulatory practices and boosting innovation and competitiveness,” Goyal said.
The two leaders also discussed the critical role of investments and mobility to bring economic vitality to this partnership. “We have agreed on building upon a framework with the EU and its member states that will hold both the EU and India in good state in advancing our economies and promoting growth for both as India rises to its rightful place on the world stage,” he said.
The Indian minister’s visit assumes significance as the two sides are examining a possibility of negotiating their free trade agreement in phases amidst an uncertain global trade environment. India has earlier followed the practice of negotiating such trade pacts in two phases with Australia. New Delhi and Washington have also planned to do a trade pact in two phases.
Negotiating the FTA in two phases allows both sides to first conclude areas where agreement can be reached more easily. Complex issues can be dealt with at a later stage. So far, India and the EU have completed ten rounds of negotiations for the proposed agreement. The next round of talks are scheduled from May 12 here.
In June 2022, India and the 27-nation EU bloc resumed the negotiations after a gap of over eight years. It stalled in 2013 due to differences over the level of opening up of the markets. On February 28, Prime Minister Narendra Modi and the European Commission President agreed to seal a much-awaited free trade deal by the end of this year.
The India-EU trade pact negotiations cover 23 policy areas or chapters including Trade in Goods, Trade in Services, Investment, Sanitary and Phytosanitary Measures, Technical Barriers to Trade, Trade Remedies, Rules of Origin, Customs and Trade Facilitation, Competition, Trade Defence, Government Procurement, Dispute Settlement, Intellectual Property Rights, Geographical Indications, and Sustainable Development.
Besides demanding significant duty cuts in automobiles and medical devices, the EU wants tax reduction in wines, spirits and a strong intellectual property regime. Indian goods’ exports to the EU, such as ready-made garments, pharmaceuticals, steel, petroleum products, and electrical machinery, can become more competitive, if the pact gets concluded successfully.
India’s bilateral trade in goods with the EU was USD 137.41 billion in 2023-24 (exports USD 75.92 billion, imports USD 61.48 billion), making it the largest trading partner of India for goods. The EU market accounts for about 17 per cent of India’s total exports, while the EU’s exports to India make up 9 per cent of its total exports. In addition, the bilateral trade in services, in 2023, between India and the EU was estimated at USD 51.45 billion.
The agreement is aimed at further boosting bilateral trade and investments between the two. The two sides are negotiating a free trade agreement, an investment protection agreement and an agreement on geographical indications.
According to official data, India’s bilateral trade in goods with the EU stood at $137.41 billion in FY24. The value of the bilateral trade in services was $51.45 billion in 2023. Biz News Business News – Personal Finance News, Share Market News, BSE/NSE News, Stock Exchange News Today
