PTI | 26 Sept 2008
FTA with EU must cover 95% goods for real benefit to India
NEW DELHI: Expressing concern that all items of export interest to India, like leather, textiles and garments, may not get covered in FTA being negotiated with the European Union, FICCI has suggested expansion of scope of the pact to cover 95 per cent of merchandise goods.
The EU should eliminate tariffs on 95 per cent of the goods under the Free Trade Agreement instead of the 90 per cent being targeted by the India-EU High Level Trade Group, the industry body said.
“This 90 per cent coverage will not guarantee any real market access for products of export interest to India in the EU,’’ it said.
The proposed FTA could increase India’s share in EU’s trade provided the latter gives meaningful market access to the products of export interest to India in the EU markets like textiles, apparels, leather products, chemicals and architectural services, besides job opportunities to medical and IT professionals, the Chamber stressed.
The 27-nation bloc has high tariffs on approximately 9 per cent of its overall tariff lines. If the coverage is limited to 90 per cent, the EU could easily prevent its sensitive products from being traded with India, it pointed out.
In 2007, share of India in EU’s total goods imports was only 1.9 per cent, while in services it was 1.5 per cent.
Bilateral trade currently stands at $65.26 billion. The two began negotiations for a FTA last year. The Chamber said in the absence of any effective resolution of issues related to non-tariff barriers faced by Indian exporters in the EU, there would not be any meaningful gains for them from the pact.