Washington, July 8 (IANS) India’s chief negotiator for the landmark free trade agreement with the European Union on Wednesday described the pact as the country’s “most ambitious agreement” to date, saying it would significantly expand market access, strengthen rules-based trade and open new opportunities for labour-intensive industries, services and technology cooperation.
Speaking at an event hosted by the Peterson Institute for International Economics, Darpan Jain, Chief Negotiator from India’s Department of Commerce, said the agreement reflected India’s broadest liberalisation commitments yet across goods, services and trade rules, while carefully protecting sensitive sectors such as agriculture.
“It is one of the most ambitious agreements,” Jain said. “India has liberalised almost the entire basket of goods… Similarly in services, the entire landscape of services has been committed.”
He added that India had also undertaken its most extensive commitments on areas including sustainable development, digital trade and non-tariff measures.
The comprehensive agreement, concluded after negotiations resumed in 2022, he said, covers goods, services, investment, digital trade, supply chain diversification and intellectual property.
It connects economies representing nearly two billion people and around a quarter of global output, making it one of the world’s largest bilateral trade agreements.
Jain said the agreement would create major opportunities for Indian exporters, particularly in labour-intensive sectors where the country has long faced tariff disadvantages in the European market.
He identified textiles and apparel as one of the biggest beneficiaries. Although the European Union imports around 170 billion dollars worth of textiles and apparel from outside the bloc, India’s share is only about 5.4 per cent. Bangladesh, benefiting from preferential access, accounts for around 17 per cent.
Similarly, India’s leather and footwear exports have considerable room for growth. While Vietnam accounts for about 23 per cent of the EU’s imports in the sector, India’s share is only around six per cent. Jain noted that tariffs of up to 17 per cent had limited India’s competitiveness and said the agreement would help narrow that gap.
Beyond merchandise trade, Jain said services represented another major growth area. He pointed to India’s leadership in digitally delivered services and said the agreement would facilitate greater collaboration in research and development, global capability centres and technology-driven industries.
“The rules would provide the foundation of predictability,” he said, adding that the agreement establishes mechanisms to resolve disputes involving technical regulations, sanitary and phytosanitary standards, licensing and other non-tariff barriers that often disrupt international commerce.
Christophe Kiener, the European Union’s chief negotiator, called the agreement “commercially very, very meaningful” and estimated that EU exporters would save about four billion euros in tariffs. He said the agreement also reflected a broader strategic partnership that now encompasses trade, security, defence, technology and mobility.
For Europe, he said, the agreement goes beyond tariff reductions by strengthening legal certainty through comprehensive chapters on digital trade, technical standards and dispute settlement.
Both negotiators stressed that the agreement was driven by long-term strategic interests rather than short-term geopolitical developments. Responding to a suggestion that recent shifts in US trade policy had accelerated the deal, Kiener said the agreement had been concluded because “there is a genuine and strategic and economic interest for the EU and India to come closer.”
The agreement also addresses sensitive issues, including the EU’s Carbon Border Adjustment Mechanism (CBAM). Jain said India and the EU had agreed on safeguards to ensure the mechanism would be applied non-discriminatorily, while establishing frameworks to recognise India’s carbon pricing measures and to cooperate on verification systems. The broader partnership also includes collaboration on green hydrogen, renewable energy, clean technologies and financial support for India’s low-carbon transition.
On implementation, Kiener said the legal review of the agreement is expected to conclude this month before it moves through the European Union’s approval process. He expressed hope that Prime Minister Narendra Modi would participate in the formal signing ceremony later this year and said the agreement could enter into force during the second quarter of next year.
Jain noted that India’s ratification process is comparatively simpler, requiring approval by the Cabinet and the President rather than Parliament.
–IANS
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