India, EU to discuss FTA on April 13 in Hannover

EU to push for higher car emission standards

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After a hiatus of over two years, India and the European Union (EU) are likely to discuss the proposed Broad-Based Trade and Investment Agreement (BTIA) on April 13. This will be the first meeting between the new leadership in both India and the EU.

The talks are scheduled between Commerce Minister Nirmala Sitharaman and EU Trade Commissioner Cecilia Malmström, on the sidelines of the Hannover Messe, the world’s largest industrial fair. India is the fair’s partner country for the first time.

The EU has insisted on a higher level of environmental standards under the BTIA or Free Trade Agreement (FTA) with India. EU had said while talks on slashing of tariffs across agriculture and industrial goods can continue, it was of vital importance for the EU to adhere to global standards.

According to commerce department officials, the matter might be discussed when both ministers meet next week. Sitharaman is accompanying Prime Minister Narendra Modi to the fair in Germany.

The meeting between the ministers, being touted as the first attempt to break the ice, is taking place in the wake of a letter written by Malmström to Sitharaman last month urging her to restart and expedite the negotiations. This was the first official communication from Brussels to New Delhi on the pending FTA.

EU ambassador to India João Cravinho had told Business Standard in an interview: “Standards are something that will make a lot of sense. You can call it something else, change the names, if you want. That’s fine. It doesn’t have to be called Euro IV or Euro V for car emissions. You can call it Bharat IV, Bharat V, no issues. The important point is that there should be convergence on standards and we are willing to engage with the bureau of standards that we have been doing but we want to do more.”

On the issue of intellectual property rights (IPR), Cravinho said the EU wanted India to only adhere to global trading norms under the World Trade Organization (WTO)’s Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS).

“The point about IPR is not that we are asking India to adhere to TRIPS, which is fine, we are not asking for TRIPS plus (provisions) but it is important that it should not be TRIPS minus. So that’s an issue we have with IPR and that’s what the Indian government accepts … We can haggle about tariffs, this is part of the process. But what should not be lost from sight is that due economic logic of developing agreements in a rapidly changing globalised world,” the ambassador added.

Talks for the FTA or BTIA started in 2007 and 13 rounds of talks have been held. However, the talks were stalled for over two years due to the change of guard both in India and the European Commission.

Over these years, the proposed FTA was ALSO attacked by civil society groups, non-government organisations and activists mainly on the issue of access to affordable health care and medicines. The FTA seeks to slash tariffs by 90 per cent over 10 years from the implementation of the pact.  The EU accounts for almost 17 per cent of the country’s total exports. The region is currently India’s largest trading partner with bilateral trade worth $130 billion in 2013-2014.