India-Europe relation: European Union excited to forge greater trading relations with India – The fastest emerging economic power.
While India-EU marks 60 years of bilateral relations, Kathleen Van Brempt, a Member of the European Parliament has exuded confidence and claimed that the new free trade agreement negotiations can deliver what proved to be impossible 9 years ago.
The FTA negotiations between India and the EU kicked off in 2007 but in 2013 they were put on hold. However, Brempt appeared highly optimistic in an article on Europe Asia Foundation, the current negotiations between India and the EU are going to bear dividends.
Significant achievement in producing Covid-19 vaccines puts India on a higher pedestal
India and the EU have been strategic partners since 2005. But India’s significant achievements in producing Covid-19 vaccines and providing them to the globe led to the expansion and diversification of trade relations.
At a time when the world is witnessing enormous energy and food crisis, coupled with climate change issues and the war in Ukraine, strengthening ties with India becomes more pragmatic and significant.
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In a renewed political dynamism from either side to boost political and economic relations, a joint Investment Protection Agreement and a Geographical indication agreement were accorded between India and the EU in June 2022. These bilateral moves will surely augment better understanding in future and should be welcomed, Brempt remarked.
India emerges as one of the most sought after trading partner
There are various reasons for the EU’s recent overtures, as India, the world’s largest democracy has surfaced as the fastest-growing economy. Its strategic location in the Central Pacific region, close to Russia and China and its emerging influence in geopolitics makes it one of the most formidable partners for the EU.
Besides, India is an enormous and vibrant market. Its promising GDP growth provides an adequate impetus for the EU to advance economic ties with India. India is the EU’s 10th largest trade partner. Similarly, the EU is India’s 3rd largest partner.
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As per estimates, almost 6000 European companies that operate in India, employ 1.7 million directly and over 5 million indirectly in various sectors.Brempt claimed that the market in India is very huge and there is much-untapped potential, and concerning market access, there are different expectations on both sides.
Reduction in export-duty may push bilateral trade
However, Brempt proposed a reduction of export tariff from the Government of India, which stands at 60 to 100% at the moment for Indian products to gain more market access in European countries.
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