European Union foreign policy chief Federica Mogherini today held talks with External Affairs Minister Sushma Swaraj on a range of issues including on preparations for the annual India-EU summit scheduled to be held here later this year. Mogherini also held delegation-level talks with Minister of State for External Affairs M J Akbar during which they discussed progress on decisions taken during the annual summit in Brussels last year.
Mogherini is here on a two-day visit. In the meeting, the EU side is understood to have pushed for early resumption of talks for the long-pending free trade pact between India and the EU.
India’s bilateral investment pacts with several European countries are expiring and citing this, the EU has been strongly pushing for moving ahead with the free trade agreement which is known as the EU-India Broad-based Trade and Investment Agreement (BTIA).
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The EU has been pressing India to extend by six months its bilateral investment pacts with several EU-member countries which are expiring soon, saying absence of the treaties could adversely impact trade ties and FTA talks. India’s existing trade and investment pacts with the Netherlands came to an end in November while similar pacts with several other EU countries are expiring in the coming months.
The EU has been maintaining that expiry of the pacts will make it difficult for European countries to go for fresh investments in India. The body wants India to first give the extension to the pacts and then move ahead with BTIA. The BTIA talks have been stalled since May 2013 when both sides failed to bridge substantial gaps on issues like data security status for the IT sector.
Launched in June 2007, negotiations for the proposed agreement have witnessed many hurdles as both sides have major differences on crucial issues. In the last EU-India Summit in Brussels, the two sides had failed to make any announcement on resumption of the negotiations as many bottlenecks still remained.
The two sides are yet to iron out issues related to tariff and movement of professionals but the EU has shown an inclination to restart talks. Besides demanding significant duty cuts in automobiles, the EU wants tax reduction in wines, spirits and dairy products, and a strong intellectual property regime.
On the other hand, India is asking the EU to grant it ‘data secure nation’ status. The country is among nations not considered data secure by the EU. The matter is crucial as it will have a bearing on Indian IT companies wanting market access.