‘India-EU trade pact will help to unleash untapped potential’
MINISTER DISCUSSES BENEFITS AS TALKS RESUME AFTER EIGHT YEARS
INDIA’S commerce and industry minister Piyush Goyal said trade agreements with the European Union (EU) would help “unleash the significant untapped potential” of economic ties between the two regions.
India and the EU last Friday (17) formally resumed negotiations on the proposed agreements, after a gap of over eight years.
Goyal said his team was in Brussels to relaunch talks for “a fair, equitable and balanced” free trade agreement (FTA) between the EU and India.
“We have our teams in place... It will further strengthen our relations. Our bilateral trade has grown significantly in the last few months. There is a significant untapped potential which we will hope to unleash with the execution of these three agreements – trade, investment and GIs (geographical indications),” he told reporters.
India had started negotiations for a trade pact, dubbed the Bilateral Trade and Investment Agreement (BTIA), with the 27-country economic bloc in 2007. However, talks stalled in 2013 as both sides failed to reach an agreement on key issues, including customs duties on automobiles and spirits, and the movement of professionals.
Asked about India’s key demands, Goyal said his country wished to engage with the world on modern products and consider areas where it could gain in terms of new technology and investment.
“All cards are on the table and we are coming with an open heart and an open mind... Agreements do not have to always be about gain or demands. I think agreements also have to be [those] which are good for both negotiating teams and for the people,” he said.
There was a time when India was “super sensitive” on issues such as gender and sustainability, the minister added, but in the past few years, the country has demonstrated “very deep commitment on these subjects” to the world.
“We are looking at technology, we are looking at long term larger finance and low cost in order to transition much faster on the sustainable side,” Goyal added.
Valdis Dombrovskis, the European Commission executive vice-president, said both sides were aiming for an ambitious and comprehensive FTA.
When asked about the demands of the EU on automobile, wines and sustainability issues, he said, “According to WTO (World Trade Organisation) standards, these kinds of agreements have to cover essentially all trade. There can be some specific exemptions... As regards sustainability, I will say no modern agreement in the EU is possible without ambitious trade and sustainable development chapters.”
These typically cover issues related to employment, and broader environment, human and labour rights, he added.
“We are pursuing an ambitious timeline and we aim to conclude the talks by the end of 2023,” Dombrovskis said.
The EU and India are already major trading partners, with an annual trade of €120 billion (£103bn). The EU is India’s third largest trade partner, accounting for almost 11 per cent of Indian trade in 2021.
India is the EU’s 10th most important trading partner, accounting for just over two per cent of EU trade in 2021. This relatively small share of overall EU trade in goods points to a large untapped potential, he added.
India’s merchandise exports to EU countries was about $65bn (£53bn) in 2021-22, while imports aggregated to $51.4bn (£41.8bn).
A GI is primarily an agricultural, natural or a manufactured product (handicrafts and industrial goods) originating from a definite geographical territory – such as Basmati rice, Darjeeling tea, Chanderi fabric, Mysore silk, Kullu shawls, Kangra tea, Thanjavur paintings, Allahabad surkha, Farrukhabad prints, Lucknow zardozi and Kashmir walnut wood carvings.