French President Macron's visit may give push to India-EU trade deal talks: GTRI

India and the European Union restarted negotiations for a long-pending trade and investment agreement in 2022

Updated - January 24, 2024 12:11 pm IST

Published - January 24, 2024 11:39 am IST - New Delhi

Indian Prime Minister Narendra Modi and French President Emmanuel Macron pose for photos before their talks at the Elysee Palace in Paris, on July 14, 2023. File

Indian Prime Minister Narendra Modi and French President Emmanuel Macron pose for photos before their talks at the Elysee Palace in Paris, on July 14, 2023. File | Photo Credit: AP

French President Emmanuel Macron's visit to India as the chief guest for the Republic Day celebrations is likely to give a fillip to the ongoing talks for a comprehensive trade agreement between India and EU, economic think tank GTRI said on January 24.

Mr. Macron will be the sixth leader from France to be the chief guest at the Republic Day celebrations on January 26. He will also visit Jaipur on Thursday.

In June 2022, India and the 27-nation bloc European Union (EU) restarted the negotiations for the long-pending trade and investment agreement, after a gap of over eight years. The negotiations for the ambitious free-trade agreement (FTA) were suspended in 2013 after several rounds of talks spanning six years.

Expanding defence cooperation, economic relationship

The Global Trade Research Initiative (GTRI) said that Mr. Macron’s visit is expected to provide an impetus to various domains of mutual interest, ranging from defence cooperation to economic ties, and from energy collaboration to space and nuclear partnerships. The discussions will likely pave the way for new agreements and deepen existing cooperation, reflecting the dynamic and evolving nature of the India-France strategic partnership, it said.

"France, as India's eighth largest trading partner, aims to strengthen trade and investment ties. Both countries are negotiating an FTA (India-EU FTA) to further expand the relationship. They may discuss market access, intellectual property rights, and investment facilitation," GTRI co-founder Ajay Srivastava said.

The seventh round of talks for the proposed agreement will be held from February 19-23 in New Delhi.

Mr. Srivastava added that the discussions may include counterterrorism, intelligence sharing, and defence technology transfer.

"Potential collaboration is also expected in renewable energy, green hydrogen, and sustainable infrastructure development, underscoring their commitment to combating climate change," it said, adding that discussions between the two countries may also focus on enhancing multilateral cooperation on global health, food security, and climate change. The growing space partnership between India's ISRO and France's CNES, including joint missions and technology transfer, will likely be a topic of discussion besides increasing cooperation in the civil nuclear segment, it said.

The economic relationship between India and France is marked by significant business presence, trade, and investment. Over 1,000 French companies operate in India across various sectors like manufacturing, services, and technology, while more than 200 Indian companies are established in France.

In 2022-23, the bilateral trade reached $19.2 billion (export $7.6 billion and imports $6.2 billion). India's exports to France included diesel ($707.9 million), ATF ($405 million), turbojets ($496 million), apparels($850 million), footwear ($157 million), smartphones ($ 248 million), gold jewellery ($160.5 million), airplane parts ($158 million), medicines ($447.8 million), and chemicals ($364.5 million). On the other hand, main imports included planes, helicopters, and/or spacecraft ($2.1 billion), LNG ($400 million), navigation equipment ($102 million), turbojets, and gas turbines ($442.2 million).

In the domain of services, India exported financial, IT, maintenance and repair, travel, transport, and other business services worth $3.2 billion to France, while importing services such as other business services, transportation, and insurance, amounting to $2.2 billion. Investment-wise, France ranks as the 11th largest investor in India, with a cumulative Foreign Direct Investment (FDI) inflow of $10.5 billion from April 2000 to March 2023.

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