India to engage with four key economies over FTAs

NEW DELHI: The year 2023 is set to be extremely busy for Indian trade negotiators as they will engage four key economies – the UK, the European Union (EU), Canada and the Gulf Cooperation Council (GCC) – on trade deals while targeting to close a deal with the UK by the Holi festivities in March, three people aware of developments said.

Though official timelines for the different negotiations are yet to be finalised, it is expected the trade deal with Australia will be operational in early 2023, and this may be followed by the conclusion of negotiations for a free trade agreement (FTA) with the UK, the people said requesting anonymity.

India finalised two deals this year– the India-UAE FTA signed on February 18 that officially entered into force on May 1, and the India-Australia Economic Cooperation and Trade Agreement (ECTA), which was inked on April 2 and was ratified by

Australia’s Parliament on Tuesday.

“While the fifth round of talks with Canada were held last week, the third round of India-EU trade negotiation is scheduled to start on November 28. Besides, the terms of reference for a trade deal with GCC are currently being negotiated. India has been approached by many other countries, but we don’t have any spare capacity left to engage with them immediately,” one of the people said. The UAE, Bahrain, Saudi Arabia, Oman, Qatar and Kuwait members of GCC.

Commerce minister Piyush Goyal and GCC secretary general Nayef Falah M. Al-Hajraf met in New Delhi on Thursday, marking the launch of IndiaGCC free trade agreement negotiations, a government spokesperson said.

“Some definite outlines of the deals with the EU and Canada are expected in 2023 as they are keen to forge trade pacts expeditiously since India has emerged one of the most reliable global sourcing hubs for goods and services. Apart from that, it is one of the shining stars while most economies are slowing down due to global headwinds,”a second person said.

The third round of the India-EU trade negotiations will be held in India from November 28 to December 9. A total of 75 sessions on 19 policy areas are scheduled for this round. India’s negotiations with the EU were revived on June 17 after a gap of almost a decade and cover three agreements on trade, investment and geographical indicators.

The first round focused on discussing EU proposals for 18 chapters, and the second was devoted to detailed exchanges on Indian responses to the EU’s proposals and on Indian textual counterproposals. The EU tabled a draft chapter on trade and sustainable development, anti-fraud and mutual administrative assistance ahead of the second round. The Indian side was requested to provide detailed explanations and clarifications of its positions to prepare for the third round, when the negotiators “should be in a position to enter into actual negotiations”, a third person said.

Further exchanges of information on most chapters are expected ahead of the third round, the third person said. The second round facilitated better understanding of each side’s sensitivities on trade in goods and also identified differences on rules of origin. There were also “differences in positions” on technical barriers to trade and “significant divergences” on trade in services.

The first person said: “Although India-EU negotiations are progressing well, due to complexities such as there being 27 EU members and other issues, a definite timeline is still not clear.”

India and the EU have set a timeline of concluding negotiations by 2023, considered ambitious since the bloc’s other FTAs have usually taken several years. Enrique Mora, the EU deputy secretary general for political affairs who was in New Delhi this week for political consultations, acknowledged the complexities involved in the trade negotiations.

“We really want to go for that. India wants to go for it but it’s not easy because you’re a big country, a big economy...But what we were absolutely sure is that by the next [India-EU] summit next year, we should have something on [the trade deal],” Mora said.

As with Australia, trade with developed countries is always good for India, which is emerging as a global supply chain hub, the first person said.

AFP The official timelines for the different negotiations are yet to be finalised,