India and the European Union (EU) have made “good progress” on certain aspects of negotiations for a free trade agreement (ALE) that the two parties want to conclude by the end of the year, the American threats of prices strengthening the justification of the agreement, said EU Ambassador Hervé Delphin.
During a visit to India in February with almost the entire college of EU commissioners, the president of the European Commission Ursula von der Leyen and Prime Minister Narendra modified launched their weight behind the ambitious objective to finalize the FTA by the end of 2025. Negotiations for the trade agreement which began in 2007 were suspended in 2013 and then resumed in 2022.
“India and the EU made good progress during the recent round (talks in Brussels in March) on certain aspects,” Delphin told a small group of journalists on Tuesday, referring to the 10th cycle of negotiations and also the first since Von der Leyen’s visit.
“The global environment accelerates negotiations. The United States reciprocal prices are strengthening the justification for an Indian-EU Ale, but it will not define them,” he said, pointing the threat of US President Donald Trump to impose reciprocal prices on the world’s business partners from April 2.
Delphin referred to the comments of Von Der Leyen last month on American prices and said: “We regret the taxation of prices. It’s bad for trade, business and people. We will defend our interests accordingly. ”
He listed several factors for the end of the last series of negotiations, including a high level of political engagement between India and the EU and “strong determination to make an ALE”.
“We would like to see the fruits of the harvest by the end of the year and the next Indian-EU summit. This is what the two leaders expressed during the recent visit to the (EU College of Commissioners). The political level is fully engaged in regular ministerial contacts,” he said.
The EU envoy said that discussions continued on the “elements of a significant trade” which will be of mutual advantage, and the two parties “work on the resolution of key requests and respective sensitivities”.
Delphin did not give details on these requests and sensitivities, but the reports highlighted the call of India to greater mobility of professionals and its efforts to protect sensitive national sectors such as agriculture and dairy products while providing market access. At the same time, the EU asked for the reduction of rates on alcohol and cars.
The Indian side also has concerns about the EU carbon border adjustment mechanism (CBAM) or a price on carbon -intensity products such as steel and cement that will take effect in 2026. The Indian team reported these concerns during the visit of Von Der Leyen, describing CBAM as a concern for a large number of countries in the world.
The EU is the largest trading partner in India in goods. Double sense trade in goods has almost doubled in the past decade to reach a figure of $ 135 billion in 2024, while the services were worth around 53 billion dollars.
Delphin noted that EU trade transactions are fully in line with the World Trade Organization (WTO).
“They are positive and respected in the long term,” he said. “EU companies in general wish to make investments in India. Tackling technical obstacles would be an important incentive for them to increase the level of investment, and an ALE would be an accelerator for this. ”
Delphin said the EU sought to considerably increase cooperation with India in clean technology, semiconductors, defense and security.
An EU report on the 10th cycle of negotiations said that sessions have been held for the first time since July 2022, by examining specific industries such as cars and medical devices and obstacles, such as prices and rules of origin, which can hinder access to the market.
In the context of the goods trade, the two parties provided a “more transparency” on the potential improvements of their first offers made in August 2023, according to the report. Although there have been “intense discussions” on the rules of origin for sectors such as agricultural, pharmaceutical and chemical products, fishing and car parts, the two parties did not make “major breakthrough”.
The report indicates that the two parties “have agreed to intensify their efforts to advance negotiations”, and the next round will be held in New Delhi from May 5.
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