India and EU to Commence Next Round of Free Trade Agreement Talks
India and the European Union are scheduled to begin the next round of negotiations for their proposed Free Trade Agreement (FTA) on Monday, May 12th. This upcoming round will reportedly focus on achieving progress on 'early harvest' agreements and addressing core trade issues between the two major economic partners. The talks aim to deepen economic ties and streamline trade amidst evolving global tariff uncertainties and geopolitical shifts.
Unpacked:
'Early harvest' agreements refer to preliminary deals within broader FTA negotiations that aim to secure quick, targeted benefits by liberalizing trade on select goods or sectors before a full agreement is finalized. They help build momentum and address pressing trade issues while larger, more complex negotiations continue.
Negotiations began in 2007 and have stalled multiple times due to disagreements over issues like foreign direct investment, market access, intellectual property rights, agriculture, and regulatory standards. Both sides have struggled to resolve differences on key sectors and trade policies, resulting in repeated delays.
The EU is a major trade partner for India, with substantial bilateral trade volumes. Both entities have strategic and economic interests in deepening their partnership, which includes cooperation beyond trade, covering areas like technology, climate change, and investment.
The EFTA deal is between India and a group of four non-EU European countries (Switzerland, Norway, Iceland, Liechtenstein), focusing on reducing tariffs and boosting investment. The India-EU FTA, still under negotiation, involves the 27 EU member states and covers broader, more complex trade and regulatory issues.