[Ip-health] The Hindu: Trade pacts stuck ahead of India-EU summit

Thiru Balasubramaniam thiru at keionline.org
Mon Sep 18 07:49:10 PDT 2017



Trade pacts stuck ahead of India-EU summit

Suhasini Haidar Arun S.

Talks remain stalled since 2013; European Union yet to okay re-engagement
despite India’s requests

With the India-European Union (EU) Summit just three weeks away, officials
in Brussels and Delhi have told The Hindu that formal talks on the proposed
bilateral Free Trade Agreement (FTA) have yet to be scheduled, despite a
public push from Prime Minister Narendra Modi and German Chancellor Angela
Merkel in May.

The officials said India had sent repeated reminders at the levels of the
Commerce and Industry Minister, the Commerce Secretary and the Chief
Negotiator to restart the talks that stalled in 2013, but the EU had not
yet given any official indication on the re-engagement.

The Delegation of the EU to India (and Bhutan) declined to comment on
specific questions sent by The Hindu on the status of negotiations and
reasons for the EU having ‘ignored’ the Indian requests.

It is learnt that the current sticking point is regarding whether an
India-EU Bilateral Investment Treaty (BIT) can be finalised first, as
demanded by the EU, or take forward India’s plan to make ‘investment
protection’ a part of the negotiations on the proposed comprehensive FTA —
officially called the Bilateral Trade and Investment Agreement (BTIA) — and
include it in the BTIA as a separate chapter.

The deadlock over ‘investment protection’ followed the EU’s concern over
what it called India’s “unilateral termination” of separate BITs with “a
significant number of” EU countries.

‘Gap in protection’

EU Trade Commissioner Cecilia Malmström had written last year to Union
Finance Minister Arun Jaitley and the then Commerce Minister, Nirmala
Sitharaman, saying: “Given that the EU Member States do not have the
possibility to renegotiate the BITs with India, the unilateral termination
of the existing BITs by India would ... create a gap in investment
protection and consequently discourage EU enterprises from further
investing in India.”

Variance over duties

The FTA talks are also stuck due to differences over the EU’s demands on
elimination of India’s duties on goods such as automobiles and wines and
spirits, and India’s pitch for a ‘data secure’ status (important for
India's IT sector to do more business with EU firms) as well as to ease
norms on temporary movement of skilled workers.

While the chief negotiators of India and the EU met informally in July in
Brussels on the margins of the EU-India Sub-commission of Trade, and are
likely to meet again on the sidelines the EU-India Summit in Delhi on
October 9 and 10, no decision has been made yet on the formal resumption of
the BTIA talks. An effort by Mr. Modi and Ms. Sitharaman and their EU
counterparts, who met in April 2016 in Brussels, also failed to break the

Asked if ‘Brexit’ and the related complications were among the factors
causing uncertainty regarding re-starting the BTIA talks, an Indian
official said, “Brexit is not an issue here. Look at the progress on the
proposed EU-Japan Economic Partnership Agreement [EPA] even after the
Brexit referendum [in June 2016].”

In July 2017, the EU and Japan reached an in-principle agreement on the
EPA’s main elements.

WTO-level negotiations

“So, if they [the EU] were really keen, they could have given us [India]
the dates to restart BTIA talks. But they have not indicated any interest
so far, despite many high-level requests from India,” the official said.

The EU-India Summit is also likely to include discussions on issues
relating to WTO-level negotiations as well on strategic cooperation between
Indian police agencies with Europol on intelligence sharing and fighting

Thiru Balasubramaniam
Geneva Representative
Knowledge Ecology International
41 22 791 6727
thiru at keionline.org

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