The Hindu : Business : India, EFTA to deeper economic engagement

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India, EFTA to deeper economic engagement

Special Correspondent

Forms joint study group to assess trade prospects Form joint study group to assess trade prospects

NEW DELHI: India and the European Free Trade Association (EFTA), comprising Switzerland, Norway, Liechtenstein and Iceland, have decided to explore the prospects of a broad-based trade and investment agreement, on the lines being considered by India with the European Union.

According to a statement issued here on Friday, India and the EFTA have established a Joint Study Group (JSG) for this purpose. "This study will examine all aspects of the existing bilateral economic relationship between India and the EFTA and recommend measures to deepen economic engagement through an expansion of two-way trade and investment flows,'' it notes

The first meeting of the group, which has been asked to give its report within one year, is scheduled to be held in February next. It is envisaged that the bilateral trade and investment agreement will cover trade in goods and services, investment, trade facilitation, technical standards , intellectual property rights and dispute settlement.

The agreement to set up the JSG was signed on Friday at a meeting of the EFTA Council in Geneva in the presence of Commerce Minister Kamal Nath and Doris Leuthard, Federal Counsellor, Federal Department of Economic Affairs of Switzerland. The chairperson of the EFTA Council and ministers from all other member states were also present. On the occasion, Mr. Kamal Nath said, "There cannot be any better way to strengthen these relationships than by talking about enhancing trade and investment flows. We are looking forward to a deeper economic engagement with EFTA".

The statement notes that there are strong complementarities between economies on both sides. "Harnessing these complementarities will result in widening and deepening our trade basket. The strong technology orientation of EFTA States can be gainfully coupled with the huge skilled human resources base of India to yield rich dividends on both sides,'' the statement adds.

Besides, it is pointed out that India's strength in the services sector and the large service consuming economies of EFTA states present an ideal situation for enhancing trade flows. "India is emerging as a major manufacturing base for the world economy. The investment potential of EFTA States can be married with India's manufacturing capabilities to create greater economic growth,'' Mr. Kamal Nath said.

The EFTA was founded in 1960 as a means of achieving growth and prosperity among its member states as well as promoting closer economic cooperation between Western European nations.

Bilateral trade between India and EFTA grew 9.3 per cent at $7.4 billion in 2005-06.

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