India, EU weigh early harvest trade pact: Commerce Secretary

“This has been our view, this we discuss with other countries also, that if some of the issues which may be not very core to the trade and maybe taking some more time, then it is better to focus on the core trade issues first. So, we say first things first, and the trade benefits should accrue to both the countries, the businesses of both the countries and the people of both the countries. And, we are also discussing with the EU what can be the early harvest or the first tranche where we can do a deal faster than if we involve all the kinds of subjects which are involved in the free trade agreement with the EU,” Barthwal said.

The Commerce Secretary said the government is taking a “very very pragmatic approach” with the EU as they are taking with the US.

A similar strategy has been adopted with the US to negotiate a first tranche ahead of the full Bilateral Trade Agreement, for which the negotiations are underway. Officials indicated that the negotiations for the BTA with the US could be wrapped up “as soon as possible” with the outer limits being fall of this year.

In February, India and the European Union had held the tenth round of trade deal negotiations, where both countries had made considerable progress in agreeing on the norms that will guide dispute settlement under the pact but failed to make a significant breakthrough on rules of origin, which help determine the national source of a product. The 10th round of talks focused on potential market access in goods, services, investment and government procurement.

Prime Minister Narendra Modi and Ursula von der Leyen, President of the European Commission, had announced that both sides would aim to conclude the free trade agreement by the end of 2025. The two parties have been negotiating the agreement since July 2022 and have held ten rounds of talks. The 11th round of talks between the two trade partners is scheduled for May 12-16 in New Delhi.

Both sides had discussed the product-specific rules for several sectors, including: “processed agricultural products, fisheries, pharmaceutical products, chemical products, fertilisers, textiles and clothing, car parts, wood pulp, and paper.” They had also held specific discussions on cars and medical devices, following an earlier statement by the 27-member bloc about not being willing to sign a trade deal without “substantive” market access from India for the sale of European-made cars.