India takes FTA bets in countries with strong diaspora
Photo Credit Twitter Ministry of Commerce and Industry
By S Jha
New Delhi, July 2: India has taken one step forwards in its ongoing talks with the European Union for Free Trade Agreement, the new policy buzzword in the Narendra Modi-led Central government, which has already inked similar pacts with the United Arab Emirates and Australia.
India is also progressing with FTA negotiations with the US and the UK.
India appears pursuing aggressive FTA negotiations with countries which have strong Indian diaspora.
The Indian diaspora in UAE and Australia with whom pacts have already been signed are seen to be formidable economic assets.
They are also significant in EU, UK and US, with a large number of the Indian diaspora in leading positions in the economic and political domains of these geographies.
India appears to be positioning for a de-globalising world amid the supply chain disruptions and emergence of the Cold war era block politics in the international order.
“India and the European Union concluded the first round of negotiations for Trade and Investment Agreements, including the Geographical Indicators (GI),” said the Ministry of Commerce and Industry in an official statement on Saturday.
The ministry also stated that the week-long negotiations were held in a hybrid fashion – with some of the teams meeting in Delhi and the majority of officials joining virtually.
“During this round 52 technical sessions, covering 18 policy areas of FTA, and 7 Sessions on Investment Protection and GIs were held. The second round of negotiations is scheduled to take place in September 2022 in Brussels,” added the Ministry.
It’s noteworthy to mention that India’s target for an FTA with the EU, US and UK are aligned to scale up the export potentials with the largest trading partners of the country, and also find opportunities for the domestic manufacturers to take advantage on accounts of favourable terms in the changing global supply chain eco-system at a time when the western world is fast becoming hostile to China for being the principal economic cushion to ‘rogue’ Russia.
India’s bilateral trade with EU amounted to USD 116.36 billion in 2021-22.
The bilateral trade despite the global pandemic induced disruptions achieved an annual growth of 43.5 in 2021-22.
“Currently, EU is India’s second largest trading partner after the US, and the second largest destination for Indian exports,” said the Ministry.
The UAE is India’s third largest trading partner.
“The trade agreement with EU would help India in further expanding and diversifying its exports of goods and services, including securing the value chains. Both sides are aiming for the trade negotiations to be broad-based, balanced, and comprehensive, based on the principles of fairness and reciprocity,” noted the Ministry after the conclusion of the first round of the talks.
It must be noted that the India-EU FTA talks is much delayed, and the urgency gained the momentum only after the Covid-19 pandemic disrupted the global order.
India’s changed stance in going for individual FTAs with countries, with an exception with the EU after the BREXIT, has also gained momentum after New Delhi walked out of China dominated Regional Comprehensive Economic Partnership (RCEP), which includes most of the East Asian economies.
India-Australia comprehensive economic partnership, inked recently, is also being hailed as a game-changer for the Indian economy at a time when Canberra is becoming averse to the domination of China.
India’s FTA push is also aligned with the country’s bid to scale up the economy to USD 5 trillion by 2025.
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