After India and the UK inked the landmark free trade agreement (FTA) on May 6 post negotiations, India and the European Union’s (EU) chief negotiators will begin the next round of talks on a free trade pact, an investment protection agreement and an agreement on geographical indications (GIs) here from Monday, according to an official. The aim of the talks will be to conclude the first phase of the pact as early as possible after it was agreed upon by both sides to have two phases of talks, especially on account of the uncertain global trade scenario amid the on-going tariff actions by US President Donald Trump.
“The EU team will be here for the 11th round of negotiations. It will continue till May 16,” the official said, adding that issues concerning convergence would be dealt with first, and that the second part is slated to be concluded by year-end.
India has followed the practice of negotiating trade pacts in two phases with Australia; and it is following a similar approach with the US.
Commerce Secretary Sunil Barthwal had held a review meeting on May 10 with senior officials involved in the negotiations. The previous round of talks had focused on market access offers in goods, services, investment and government procurement.
“If some of the issues which may not be very core to the trade, maybe taking some more time, then it is better to focus on core trade issues. So, we say that first things first...We are also discussing with the EU what can be the early harvest of the first tranche, where we can do faster”, he said.
Indian goods’ exports to the EU, such as ready-made garments, pharmaceuticals, steel, petroleum products, and electrical machinery, can become more competitive if the pact gets concluded successfully. Besides demanding significant duty cuts in automobiles and medical devices, the EU wants tax reduction in products like wines, spirits, meat, poultry and a strong intellectual property regime.
The India-EU trade pact negotiations cover 23 policy areas or chapters, including Trade in Goods, Trade in Services, Investment, Sanitary and Phytosanitary Measures, Technical Barriers to Trade, Trade Remedies, Rules of Origin, Customs and Trade Facilitation, Competition, Trade Defence, Government Procurement, Dispute Settlement, Intellectual Property Rights, Geographical Indications, and Sustainable Development.
India’s bilateral trade in goods with the EU was USD 137.41 billion in 2023-24 (exports - USD 75.92 billion, imports - USD 61.48 billion), making it the largest trading partner for goods and making it account for about 17 per cent of India’s total exports, while exports to India make up 9 per cent of its total exports.
In addition, the bilateral trade in services, in 2023, between India and the EU was estimated at USD 51.45 billion.
Here’s a timeline of the how the talks unfolded over the years:
On February 28, Prime Minister Narendra Modi and the European Commission President agreed to seal a much-awaited free trade deal by the end of this year.
On May 1, Commerce and Industry Minister Piyush Goyal was in Brussels to discuss progress on the agreement.
In June 2022, India and the 27-nation EU bloc resumed negotiations after a gap of over eight years. It was stalled in 2013 due to differences over the level of opening up of the markets.
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