New Delhi: With India and the EU setting the year-end deadline to conclude a free trade agreement, teams from both sides held discussions on Saturday to accelerate efforts towards a balanced and mutually beneficial pact. The meeting was held between Commerce and Industry Minister Piyush Goyal and EU Commissioner for Trade and Economic Security Maros Sefcovic in Mumbai along with officials from both sides. "Our discussions focused on accelerating efforts towards a balanced and mutually beneficial free trade agreement. Looking forward to deepening economic ties and fostering a prosperous India-EU partnership," Goyal said in a post on X.
On February 28, Prime Minister Narendra Modi and European Commission President Ursula von der Leyen agreed to seal a much-awaited free trade deal by this year amid rising concerns over US President Donald Trump's policy on tariffs. The two sides are scheduled to hold the tenth round of negotiations for the FTA from March 10-14 in Brussels. Further strengthening of economic ties between the two is crucial in light of the threat from US President Donald Trump to impose higher tariffs. In the current uncertain global economic situation, India is the fastest-growing major economy. It is projected to grow at 6.4 per cent in 2024-25. In June 2022, India and the 27-nation EU bloc resumed the negotiations after a gap of over eight years. It stalled in 2013 due to differences over the level of opening up of the markets. Besides demanding significant duty cuts in automobiles, the EU wants tax reduction in wines, spirits and a strong intellectual property regime. Indian goods' exports to the EU, such as ready-made garments, pharmaceuticals, steel, petroleum products, and electrical machinery, will become more competitive if the pact is concluded successfully.
India is also seeking data security status for the IT sector. The lack of this status has prevented the flow of sensitive information to India, a big deal for its IT industry. 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 of India for goods. The EU market accounts for about 17 per cent of India's total exports, while the EU's 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. The agreement is aimed at further boosting bilateral trade and investments between the two. The two sides are negotiating a free trade agreement, an investment protection agreement and an agreement on geographical indications (GIs). EU's investments in India are valued at over USD 117 billion with around 6,000 European companies present in India. India's investments in the EU are valued at around USD 40 billion.