India and the European Union are scheduled to begin the next round of talks for a proposed free trade agreement (FTA) from Monday in Brussels with the aim of concluding the talks by the end of this year, a senior official said.
Prime Minister Narendra Modi and European Commission President Ursula von der Leyen had agreed to expedite the conclusion of the India-EU free trade agreement (FTA) by the end of the year at their meeting in Delhi last month.
“A free trade agreement between the EU and India would be the largest deal of this kind anywhere in the world. I am well aware it will not be easy. But I also know that timing and determination count and that this partnership comes at the right moment for both of us,” Von der Leyen, said during her two-day visit to India.
Her statement came in the backdrop of massive tariff hikes proposed against all countries by US President Donald Trump under his ‘America First’ policy which is threatening to disrupt global trade and heighten uncertainty in the global economy.
PM Modi and the European Commission President committed to task their respective negotiating teams to pursue negotiations for a balanced, ambitious, and mutually beneficial FTA. Officials were asked to work as trusted partners to enhance market access and remove trade barriers. They were also tasked to advance negotiations on an Agreement on Investment Protection and an Agreement on Geographical Indications.
Reaching a deal will be complex, however, with significant concessions wanted on both sides in areas ranging from cars and whisky to pharmaceuticals and textiles.
The EU wants India to lower tariffs on cars, wine, and whisky as well as some agricultural products. India, on the other hand, wants greater market access and lower tariffs for key exports, including pharmaceuticals, textiles, and apparel.
The EU is India’s largest trading partner, accounting for 124 billion euros of trade in goods in 2023, or 12.2 per cent of total Indian trade. Trade in services between the EU and India reached nearly 60 billion euros in 2023, almost double the level in 2020. A third of that were digital services, according to figures compiled by the World Economic Forum.
The US and China account for 10.8 per cent and 10.5 per cent of total Indian trade, respectively. India, meanwhile, is the EU’s ninth largest trading partner, accounting for 2.2 per cent of the bloc’s trade, WEF figures show.
Trade between India and the EU has grown by around 90 per cent in the past decade, but talks over a free trade pact have stalled over the years due to sharp differences between India and the 27-nation bloc on agriculture, automobiles, and pharmaceuticals.
(IANS)
