Daijiworld Media Network – New Delhi
New Delhi, March 9: India and the European Union (EU) should start the next series of negotiations on their proposed free trade agreement (ALE) in Brussels on Monday, the two parties aimed at finalizing the agreement by the end of this year, according to a senior official.
The renewed thrust follows a commitment made by Prime Minister Narendra Modi and the president of the European Commission Ursula von der Leyen at their meeting in Delhi last month to accelerate negotiations and reach a balanced, ambitious and mutually beneficial commercial pact.
“A free trade agreement between the EU and India would be the greatest agreement of this kind in the world. I am well aware that it will not be easy. But I also know that timing and determination count, and that this partnership arrives at the right time for the two of us,” said Von der Leyen during his two-day visit to India.
His remarks come within the framework of the growing uncertainty of world trade, in particular following the proposal of American president Donald Trump in massive tariff hiking under his policy of “America first”, which threatens to disrupt international trade.
Although the two parties are impatient to finalize the agreement, the main obstacles remain, in particular in sectors such as cars, agriculture, whiskey and pharmaceutical products. The EU is looking for lower prices on cars, wine, whiskey and agricultural products, while India has higher access and prices for pharmaceuticals, textiles and clothing.
Negotiators will also focus on the progress of two parallel agreements: an agreement on investment protection and an agreement on geographic indications.
The EU remains the largest trading partner in India, representing 124 billion euros in trade in goods in 2023, representing 12.2% of the total trade in India. The service trade between the two partners has almost doubled since 2020, reaching 60 billion euros last year, the digital services comprising a third of the total. In comparison, the United States (10.8%) and China (10.5%) each represent a slightly smaller share of the total trade in India. Meanwhile, India is the ninth EU trading partner, representing 2.2% of the overall trade in the block, according to data from the World Economic Forum (WEF).
Despite significant growth in Indian -EU trade – 90% over the past decade, negotiations on an ALE have faced several delays due to persistent disagreements in the key sectors. However, with the global assembly of economic uncertainty, the two parties are under pressure to overcome the differences and finalize an agreement that could unlock new commercial opportunities for businesses in the two regions.
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