New Europe | 18 October 2009
EU-India’s free trade deal is still in the talking stage
Two years after the European Union and India began negotiating a Free Trade Agreement that has enemies in both places, the talks are continuing with the hope of concluding by the end of the year, but not in time for the EU-India Summit in New Delhi on Nov. 6. The sticking points were highlighted in Brussels earlier this month by India’s Minister for Overseas Indian Affairs Vayalar Ravi at the India Calling 2009 Conference which attracted nearly 300 Indian business leaders under the aegis of one of thethe country’s most-respected business organizations, the 103-year-old Indian Merchants Chamber, including its President Gul Kripalani, whose own seafood processing company has deals with EU supermarkets.
IMC President, Gul Kirpalani, highlighted the significance of the India-EU business partnership summit against the backdrop of a dismal global economic environment. He complimented the authorities of the European Union for actively assisting in promotion of this conference at this histoeric juncture. Kripalani welcomed the offering to the IMC, the free use of an office space for one year for carrying on its promotional activities in Belgium, “which is the gateway to Europe and by itself also an important centre of business.”
Between the governments, a number of controversies have been plaguing the talks. Delhi wants Brussels to relax its stringent food safety criteria which penalize Indian farm and fishery exports and to make it easier for Indian professionals to work in the EU. Europe is primarily out to win major openings of India’s services sector and broad liberalisation of foreign investment, while India does not want to discuss allowing European firms to compete in India’s government procurement market. Indian social movements, including fishermen and women and labor unions, are building up strong campaigns against the FTA.
A Free Trade Agreement (FTA) is a trade treaty between two or more countries usually designed to reduce or completely remove tariffs on trade. The Geneva-based World Trade Organization said there are more than 200 FTAs in force. Most FTAs are between two individual countries, however, agreements can be reached between a trade bloc such as the EU and a individual country.
The European Union is India’s top-most partner in the area of trade and investment inflows and one of the major partners in the field of economic and development co-operation, Ravi said, urging more rapid progress in the discussions. The Free Trade Agreement is designed to provide a further impetus to the growing partnership, Ravi said. By 2020, India would have the world’s largest youth population, and the world’s “largest work-force, estimated at over 820-million in the working age group as compared to its 400-million strong work-force today,” he said. The scenario presented a tremendous opportunity to both domestic and foreign players to fund and operate infrastructure development projects on the basis of the public-private partnership (PPP) model, Ravi said. Yves Leterme, Belgium’s Minister of Foreign Affairs, called upon enterprising business leaders in India and Belgium to take full advantage of the close economic ties between India and the European Union for expanding their businesses by forging partnership in the fields of trade, industry, investment and transfer of technology and know-how for mutual benefit, India’s Economic Times repoted. Leterme, who was the chief guest at the conference, said the conference was being held at the most opportune time between two historic events -the state visit of Belgium’s King Albert II to India in November 2008 and the Prince Philippe-led Belgian Economic Mission to India, scheduled in March 2010. “Belgium will assume the Presidency of the European Union in the second-half of 2010 and will host the EU-India Summit in Brussels in that capacity,” he said.