Expert-level negotiations on non-tariff barriers will be held next week

India and the European Union (EU) will undertake intense negotiation over the next four months in an attempt to tie-up the Free Trade Agreement (FTA) before their next summit in February, EU Trade spokesman John Clancy said in a statement.

His latest optimism reflects similar sentiments expressed six months ago when Mr. Tracy listed the same three areas — tariffs, services and procurement — as the main sticking points. At that time, Commerce Minister Anand Sharma was also confident of the agreement, under negotiations for four years, being finalised before this year-end. The two sides will negotiate on services and establishment this week and expert-level negotiations on non-tariff barriers during the week of November 21. Chief negotiators during the week of December 5 will discuss all outstanding issues and further engagement between senior officials in mid-December.

Studies have confirmed that the more ambitious the FTA, the more beneficial it will be. In the short-run alone, India is expected to gain euro 5 billion and the EU over euro 4 billion, according to the EU.

Diplomatic sources here said of the issues at stake, both sides have more or less agreed on the wording for an agreement on Intellectual Property Rights. They are addressing India's demand for freer movement of its nationals and the EU's counter demand for getting into government procurement. And, both sides are still whittling down differences on the extent they can reduce tariffs.

On the main issue of elimination of tariffs, both sides are negotiating the percentage of lines that would be covered. The EU would like India to bring 98 per cent of its tariff lines under its ambit whereas New Delhi insists that this process should be asymmetric. In other words, while India would reduce tariffs on 95 product lines the percentage should be 3 per cent higher for the EU.

India is also seeking greater access to the EU by its nationals with negotiators from Brussels arguing that this issue is dealt by member states. With the Union Cabinet having recently approved foreign direct investment in the pension, retail and aviation sectors, a key demand by the EU and the U.S., India is hoping there would be an agreement on some of the options being explored to ensure easier entry into the EU by at least its skilled nationals. “This is a very important deal for the EU and India.” said Mr. Clancy.


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