The Hindu Business Line : India-EU trade down 18% in first half

On the goods side, both India and the EU have offered to each other tariff elimination on 90 per cent of the goods under trade over a seven-year period.

K.R. Srivats

Brussels, Oct. 16

India-EU bilateral trade in goods recorded 18 per cent decline in the first half of the calendar year 2009 as global economic downturn continued to cast a shadow on the trade performance of both sides.

The bilateral trade in goods during January-June 2009 stood at €25.19 billion, about 18 per cent lower than the €30.54-billion in the corresponding period last year, official data available with the European Commission showed.

Bilateral trade in goods had nearly doubled between 2004 and 2008. From a level of €33.52 billion in 2004, the bilateral trade moved up to €40 billion in 2005, €47 billion in 2006, €56 billion in 2007 and €61 billion in 2008.

Text-based discussions

India and the EU have already moved into text-based discussions on all the chapters in the proposed free trade agreement (FTA).

After the launch of negotiations in June 2007, seven negotiating rounds had been held, covering goods, services, investments, trade facilitation, public procurement, technical regulations (TBT and SPS), competition, intellectual property issues (IPR) and other issues.

Indications are that the eighth round may happen in January next year.

Even as both sides had entered into text-based discussions on all chapters, none of the chapters have so far been concluded, sources familiar with the state of play on the India-EU FTA said.

“We are at a fairly early stage of the legal texts,” sources said.

EU role

The India-EU summit in New Delhi on November 6 is expected to provide further momentum and direction to the talks, the EC officials here said.

Sources also said that the India-EU FTA would require the prior nod of EU Parliament on account of the Lisbon Treaty, which is expected to come into force this year.

Tariff elimination

On the goods side, both India and the EU have offered to each other tariff elimination on 90 per cent of the goods under trade over a seven-year period. However, there is still no agreement with regard to tariff elimination.

On the services front, no offers or requests have been made from both the sides as part of the FTA negotiations.

Indications are that the next round of negotiations on the FTA front will happen in January 2010.