India mulling proposal to join Eurasian Union

Prime Minister Narendra Modi with Uzbekistan's President Islam Karimov inspect guard of honour during a welcome ceremony at Presidential complex in Tashkent, Uzbekistan on Monday.— PHOTO: PTI  

Prime Minister Narendra Modi’s ongoing visit to Russia and five Central Asian nations could expedite the feasibility studies under way to assess whether India should sign a free trade agreement (FTA) with the Eurasian Economic Union (EEU).

Even as it is yet to firm up its agreements with the European Union, India is considering the option of signing a pact with the EEU, which has Russia, Belarus, Kazakhstan, Kyrgyzstan and Armenia as members, and will see the inclusion of Tajikistan later this year.

Joint study group

According to government officials, a joint study group, headed by a Joint Secretary in the Ministry of Commerce, has been mandated to study the benefits of joining the trade bloc, but with the emphasis on enhancing trade and investment ties with the Central Asian countries, there is a possibility that an agreement could be on the cards soon.

An invitation to join the bloc was extended by Russia, and a joint statement for establishment of a joint study group between India and the EEU was signed when Commerce and Industry Minister Nirmala Sitharaman visited Russia recently.

A senior official on condition of anonymity said though India is keen to secure its position vis-à-vis tariff lines, it is also considering signing up with different trade blocs like the Latin American Integration Association (ALADI) which now has 13 members, the North American Free Trade Agreement (NAFTA) and the ASEAN Free Trade Area (AFTA).

“Trade is becoming more and more regional; the EU for instance is focusing on trade within members. While India has to protect investment and trade from becoming imbalanced, it also has to ensure that its goods are not discriminated against. It is best for India to gain access to all important trade blocs,” the official said.

India is keen to enhance its ties with the Central Asian countries, which have huge oil and gas reserves and are an important link to Afghanistan.

Free trade pacts

While officials are weighing up the consequences of joining the EEU and the EU, there are also reports of Iran, Egypt and Israel considering the possibility of signing free trade agreements with the EEU. Vietnam too has signed a free trade agreement with the EEU.

Aftab Kamal Pasha, Professor at the Centre for West Asian Studies, Jawaharlal Nehru University, says India must consider an FTA with the EEU, because it will be an opportunity for improving trade ties as well as foster relations to check the menace of growing radicalisation in the region.

‘An opportunity’

“India keeps talking of an Asian century, but we seem to be losing out … we should have taken the lead for Asian initiatives. This is an opportunity and we must proactively associate [with] and contribute [to]. These associations indicate a growing regional growth,” he told The Hindu .