The Hindu : Business : India ready to open 90 p.c. of market to EU cos.

Online edition of India's National Newspaper
Friday, Nov 30, 2007
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India ready to open 90 p.c. of market to EU cos.

Staff Reporter

EU will reciprocate any new access India offered: Mandelson

FTA with EU by end of next year
EU is India’s largest trading partner

NEW DELHI: Union Commerce and Industry Minister Kamal Nath on Thursday hoped that the much-awaited Free Trade Agreement (FTA) with the European Union (EU) would be signed by the end of next year. He also urged the EU, the 27-nation trade bloc, to ask the U.S. to cut subsidies to its rich farmers so that the stalled trade talks could be concluded.

Speaking at the 8th India-EU Summit here organised by the Confederation of Indian Industry (CII) and the Federation of Indian Chambers of Commerce and Industry (FICCI), Mr. Kamal Nath said: “India is as ambitious for the FTA as is the European Union.”

India is ready to open 90 per cent of its fast growing market for EU companies, while it would expect its partner to reciprocate with 95 per cent of their market. Agriculture is not an issue with the EU for concluding an FTA which encompasses trade, services and investment, he said. The EU is India’s largest trading partner with an 18 per cent share of India’s foreign trade. Bilateral trade was worth 47 billion euros in 2006.

Mr. Kamal Nath also called upon the EU to tell the U.S. that an early global trade deal under the Doha Round of World Trade Organization (WTO) negotiations was possible provided the developed nations cut subsidies to rich farmers. “India will not negotiate on subsistence farming. I have told the U.S. that India will have a deal if they reduce subsidies even by a dollar. But there has been no response,” he added.

EU Trade Commissioner Peter Mandelson said he was also impatient to see the FTA go through.

The EU would like to see openness in services and investment trade extended into government procurement in India and would reciprocate any new access India offered, he added.

“An ambitious FTA with India could provide a big boost to economies and would be a win-win situation for both. India is now an indispensable part of the global economic architecture. The trade pact could provide a strong boost to the Indian manufacturing sector through new access to the European market and by making European industrial exports to India cheaper. India could also tap the opportunities from its trading partners to develop its infrastructure,” he added.

Mr. Mandelson also said three quarters of Indian imports are inputs for manufacturing or services trade so tariffs affect the cost of Indian businesses.

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