India and the EU are engaging in discussions to accelerate FTA negotiations with a deadline set for year-end 2025. Key stakeholders, including Minister Piyush Goyal and EU Commissioner Maros Sefcovic, are focused on establishing a balanced and mutually beneficial trade agreement amidst rising tariff concerns from the US. The leaders aim to enhance bilateral trade, which currently stands at $137.41 billion, significantly benefiting both economies.
On March 1, 2025, India and the European Union (EU) engaged in discussions to expedite negotiations for a free trade agreement (FTA) with a target completion by the end of the year. The meeting took place in Mumbai, led by Commerce and Industry Minister Piyush Goyal and EU Commissioner for Trade and Economic Security Maros Sefcovic, accompanied by officials from both parties.
Minister Goyal emphasized, “Our discussions focused on accelerating efforts towards a balanced and mutually beneficial free trade agreement. Looking forward to deepening economic ties and fostering a prosperous India-EU partnership.” This initiative follows an agreement between Prime Minister Narendra Modi and European Commission President Ursula von der Leyen to finalize the trade deal amidst mounting concerns over U.S. tariff policies.
The upcoming tenth round of negotiations is set for March 10-14 in Brussels. Strengthening trade ties is crucial as India is currently the fastest-growing economy, projected to expand by 6.4% in 2024-25. Previous negotiations, which started anew in June 2022, had stalled in 2013 due to market access disagreements.
The EU’s demands include significant reductions on automobile tariffs, lower taxes on wines and spirits, and robust intellectual property protections. Should the FTA succeed, Indian exports—such as garments, pharmaceuticals, and machinery—could gain increased competitiveness in the EU market, which accounts for 17% of India’s total exports.
India is pursuing specific data security status for its IT industry, which is essential for the handling of sensitive information. In 2023-24, bilateral trade in goods between India and the EU reached $137.41 billion, with $75.92 billion in exports from India and $61.48 billion in imports.
Additionally, trade in services was estimated at $51.45 billion in 2023. The agreement aims to enhance bilateral trade and investment, encompassing negotiations on investment protection and geographical indications (GIs). EU investments in India total over $117 billion, with around 6,000 European businesses operating in the country, while India’s investments in the EU are approximately $40 billion.
India and the EU are actively working towards expediting their free trade agreement discussions with a year-end deadline. Key economic ties, addressing tariff concerns, and enhancing trade in goods and services are central to their negotiations. The successful conclusion of this FTA could significantly bolster both economies, fostering greater cooperation and prosperity.
Original Source: www.thehindu.com
