India and the European Union (EU) have resumed dialogue for a free trade agreement (FTA) after a nine-year-long lull, the Ministry of Commerce and Industry said on Saturday, 18 June.
EU trade commissioner Valdis Dombrovskis expressed his pleasure saying, “Pleased that we re-started talks on Free Trade Agreement today (with India). Next round of negotiations will take place from June 27 till July 1 in New Delhi."
“We're pursuing an ambitious timeline and we aim to conclude talks by end of 2023," Dombrovskis added.
A statement from the Ministry of Commerce and Industry said that negotiations were also launched for a Geographical Indicators (GIs) Agreement, and a stand-alone Investment Protection Agreement (IPA).
This FTA would be one of the most significant for India, with the India-EU merchandise trade registering a record-high value of $116.36 billion in 2021-22 with 43.5 percent year-on-year growth. The 2021-22 financial year saw India’s exports to the EU increase by 57 percent to $65 billion, keeping a trade surplus with the EU.
The negotiations will see discussions attempting to resolve impediments to bilateral trade like the Market Access Issues. Moreover, while the proposed IPA provides a legal structure to enhance the confidence of investors through cross-border investments.
There will also be discussions on resolving the Market Access Issues which are impeding the bilateral trade.
"Both partners are now resuming the FTA talks after a gap of about nine years since the earlier negotiations were left off in 2013 due to difference in the scope and expectations from the deal," the Indian Commerce Ministry added.
The India-EU Leaders’ meeting in Porto earlier in May 2021 saw an agreement being reached to resume negotiations to achieve a balanced, comprehensive, ambitious and mutually-beneficial FTA, with separate GI agreements, a report in Mint said.
Both parties are aiming to negotiate all the three agreements simultaneously.
Earlier this year, India concluded FTAs with UAE and Australia, with FTA talks underway with the United Kingdom and Canada.
Prime Minister Narendra Modi's recent visit to Europe and EU President Ursula von der Leyen's visit to New Delhi in April 2022 accelerated the FTA discussions and helped define a structure to the negotiations.
(With inputs from Mint.)
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