In­dia-EU at­tempts to re-start free trade talks stum­ble on old is­sues

Both sides may now hold talks on spe­cific ar­eas to help re­solve mat­ters

The Hindu Business Line - - NEWS - AMITI SEN

There may be no early res­o­lu­tion to the dead­locked ne­go­ti­a­tions be­tween In­dia and the EU on the pro­posed bi­lat­eral free trade pact.

A re­cent meet­ing be­tween se­nior of­fi­cials of the two sides in Brus­sels to get talks re-started failed to re­sult in a break­through, a gov­ern­ment of­fi­cial told Busi­nessLine.

“Old is­sues which led to the col­lapse of talks such as mar­ket ac­cess for wines and spir­its and au­to­mo­biles and in­clu­sion of en­vi­ron­ment in the talks re­main stick­ing points. An ap­pro­pri­ate in­vest­ment treaty is an­other trou­ble­some area. Both sides haven't yet found a way to get around these,” the of­fi­cial said.

A team from the Com­merce Min­istry, headed by Com­merce Sec­re­tary Anup Wadhawan, had vis­ited Brus­sels last month to talk to coun­ter­parts in the EU. New Delhi is of the opin­ion that it has of­fered more than it has to any other partner in terms of in­creased mar­ket ac­cess in sen­si­tive ar­eas like al­co­hol and cars but the EU is not con­vinced.

The two sides, how­ever, are not ready to give up their ef­forts. “There will be talks in the fu­ture on spe­cific ar­eas where there is se­ri­ous dis­agree­ment. If these ar­eas are ironed out, the ne­go­ti­a­tions can def­i­nitely progress,” the of­fi­cial said.

With the UK’s de­ci­sion to exit the EU, the bloc may be more liberal now in terms of eas­ing visas for In­dian pro­fes­sion­als, a key de­mand made by New Delhi, but it would only be in re­turn for what New Delhi is of the opin­ion that it has of­fered more than it has to any other partner in terms of in­creased mar­ket ac­cess

it wants in terms of greater mar­ket ac­cess in the ar­eas it has been tar­get­ing.

Ne­go­ti­a­tions for a free trade pact, for­mally called a broad­based trade and in­vest­ment agree­ment (BTIA), be­tween the EU and In­dia started in 2007, but were unof­fi­cially sus­pended in 2013 when both sides re­alised that no move­ment was hap­pen­ing

on con­tentious mat­ters. Since then, pe­ri­odic ef­forts have been made to re­sume talks, but there has been no pos­i­tive re­sults.

Bi­lat­eral vs sin­gle treaties

In­dia’s de­ci­sion to end/sus­pend bi­lat­eral in­vest­ment treaties it has with its partner coun­tries, in­clud­ing EU mem­bers, and seek fresh pacts based on its model in­vest­ment pact is a fresh area of con­cern. The EU wants In­dia to sign a sin­gle in­vest­ment treaty with all mem­bers as part of the BTIA and wants a num­ber of items sug­gested in the model treaty re­moved, in­clud­ing pro­vi­sions on In­vestor State Dis­pute Set­tle­ment (ISDS).

“The EU is now in­sis­tent that the BIT also be part of the BTIA be­ing ne­go­ti­ated and this has made the mat­ter more com­pli­cated as there are sev­eral ar­eas where In­dia and the EU don’t see eye to eye,” the of­fi­cial said.

The EU is of the opin­ion that there are too many pro­vi­sions in In­dia’s model BIT which pro­tect the gov­ern­ment and go against the in­ter­est of the in­vestor.

The EU, with the in­clu­sion of the UK, is one of In­dia’s largest trad­ing partner ac­count­ing for $53.62 bil­lion (17.64 per cent share) of ex­ports and $47.87 bil­lion (10.28 per cent of share) in 2017-18.

GETTY IM­AGES/ISTOCKPHOTO

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