EU and India conclude negotiations on a free trade agreement
SLOVENIA, January 28 - This is the largest agreement of its kind ever concluded by either party.
The EU and India already trade goods and services worth more than €180 billion annually, supporting nearly 800,000 jobs in the EU. The agreement is expected to double the export of goods from the EU to India by 2032 by means of either eliminating or reducing tariffs on 96.6% of EU exports to India. Overall, tariff reductions are expected to save around €4 billion per year in duties on European products.
The ambitious opening of this particular market will provide a significant competitive advantage for key EU industrial and agri-food sectors, giving companies preferential access to the world's most populous country of 1.45 billion people and the fastest-growing major economy, with an annual gross domestic product of €3.4 trillion.
The agreement will create the world's largest free trade area, as together, the EU and India account for nearly a quarter of the global population, namely two billion people, and approximately 25% of global GDP. It will additionally remove trade barriers, simplify procedures, open up new export opportunities for businesses and strengthen the EU's economic security.
Opportunities for European and Slovenian companies of all sizes
India will grant substantial tariff reductions for goods originating in the EU. For example, current tariffs on cars will be gradually reduced from 110% to as low as 10% (quota of 250,000 vehicles), while tariffs on automotive parts will be fully eliminated after a period of between five and ten years. Tariffs of up to 44% on machinery, up to 22% on chemicals and up to 11% on pharmaceuticals will also be largely eliminated.
A dedicated chapter will be devoted to small and medium-sized enterprises (SMEs) from the EU and Slovenia. SMEs will benefit, in particular, from tariff reductions, the removal of regulatory barriers as well as the transparency, stability and predictability provided by the agreement.
Reduced tariffs on agri-food products
The agreement eliminates or reduces high tariffs (currently averaging over 36%) on EU agri-food exports, opening up a major market for European farmers. For instance, Indian tariffs on wine will be reduced from 150% to 75% upon the agreement's entry into force and gradually lowered to 20%, tariffs on olive oil will be reduced from 45% to 0% within five years, while tariffs of up to 50% on processed agricultural products such as bread and confectionery will be eliminated entirely.
Sensitive European agricultural sectors will be fully protected as products such as beef, poultry, honey, wheat, rice, sugar and ethanol are excluded from liberalisation under the agreement. All imports from India will continue to comply with the EU's strict food health and safety regulations.
Preferential access to services markets and protected intellectual property
The agreement will grant EU companies preferential access to the Indian services market, including key sectors such as financial services and maritime transport.
It also ensures a high level of protection and the enforcement of intellectual property rights, including copyrights, trademarks, designs and trade secrets.
Strengthening sustainability commitments
The agreement includes a dedicated chapter on trade and sustainable development, strengthening environmental protections and addressing climate change, safeguarding labour rights, supporting women's empowerment and providing a platform for dialogue and cooperation on trade-related environmental and climate issues, while also ensuring effective implementation.
Next steps
In line with the principle of transparency, the draft text of the agreement, for which negotiations have been concluded, will soon be published on the European Commission's website (in English). The draft will first be reviewed by lawyer-linguists, after which translations into all official EU languages will be prepared. The European Commission will then prepare a proposal for a decision on the signing of the agreement and a proposal for a decision on the conclusion of the agreement and will submit these, together with the text of the agreement, to the Council of the EU and the European Parliament for further consideration. Once the Council of the EU has approved the decision to sign the agreement, the parties will be able to agree on a signing date and formally sign the agreement. The agreement will also be examined by the European Parliament. The EU procedure will be completed once the European Parliament gives its consent and the Council of the EU adopts the decision on the conclusion of the agreement. India must also complete its internal approval procedures. Once both parties have completed their respective internal procedures and notified the depositary, the agreement may enter into force either on the first day of the second month following the exchange of written notifications of completion of internal procedures or on a date agreed upon by the parties. The date of entry into force will be published in the Official Journal of the EU.
Background
The EU and India launched into negotiations on a free trade agreement in 2007. Talks were suspended in 2013 and resumed in 2022. Fourteen rounds of negotiations were held, along with numerous inter-sessional discussions at both technical and political levels. The European Commission negotiated on behalf of the EU Member States.
At the same time as the resumption of free trade agreement negotiations, the EU and India also launched separate negotiations on a geographical indications agreement alongside an investment protection agreement. Negotiations for these agreements are still ongoing.
More information
Legal Disclaimer:
EIN Presswire provides this news content "as is" without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the author above.
