Time to conclude free trade agreement, India tells EU

The Indian government on Thursday urged the European Union to conclude negotiations on a bilateral free trade agreement, saying the parties have arrived at the point of compromise that could be upset if EU became over-ambitious.

"What is the point at which EU will feel satisfied? In our perspective, we have already arrived at that point and EU should feel satisfied. If EU has more ambitions, which it believes should be satisfied now, we might have some reservations," Commerce Secretary Rajeev Kher said at a seminar here on the Foreign Trade Policy organised by industry chamber FICCI.

"We have not spoken for some time now in a formal sense. Informally, we have been getting messages through public announcements that EU is interested in taking up the process forward. This has been said on our side that we find it very interesting to pursue India-EU BTIA," he added.

Negotiations on the FTA, officially dubbed the Broad-based Trade and Investment Agreement (BTIA), between India and the 28-nation EU, were launched in June 2007 but have been facing hurdles with differences between both sides on crucial issues.

Besides demanding major duty cuts for exporting automobiles to India, the EU wants tax reduction in wines, spirits and dairy products as well as a strong intellectual property rights (IPR)regime in the country.

However, the Indian automobiles industry has raised an alarm over the sector being included in the FTA, claiming it will kill investments and technology flow into the country, resulting in under-achievement of the government's automotive mission plan.

In May 2013, the parties failed to bridge differences over crucial issues, including data security and visa liberalisation related matters. No formal round of talks have been held since then.

Speaking a day after the government unveiled the Foreign Trade Policy 2015-20, Kher also said exporters from select labour intensive sectors will be able to access cheaper credit soon as the government hopes to restart its interest subvention scheme that was discontinued last year due to resource constraints.

"The finance ministry has given us the sanction for extending the interest subvention scheme for exports for three years. We are working out the details of the scheme and hope to be ready with it in two-three months," he said.