India will hold consultations with the European Union (EU) in January, 2016 to discuss the future of the proposed free trade agreement (FTA), Commerce Secretary Rita Teaotia said on Thursday.
The meeting, which will take place after a gap of 30 months, will not be a negotiation but a continuation of talks that had been deferred after the EU banned the sale of around 700 pharmaceutical products, clinically tested by Indian company GVK Biosciences, on grounds of being unsafe.
Launched in June 2007, the negotiations for the proposed Broad-based Trade and Investment Agreement (BTIA), also known as FTA, have witnessed many hurdles with both sides expressing differences on crucial issues.
Chief negotiators on both sides were scheduled to meet in August, but India had cancelled talks after the impasse over the ban on pharma products could not be broken.
The January meeting is set to determine the future of the FTA as the issue has dragged on for far more time than both sides had hoped.
“We are going to meet in January to do a stocktaking and see if this negotiation has a future”, Teaotia said. In May 2013, India and the EU failed to bridge substantial gaps on crucial issues, including data security status for the information technology sector.
The recent thaw in India-EU relations reportedly started after German Chancellor Angela Merkel’s visit to India in October. Maintaining that India perceived the GVK incident as an “extremely disproportionate reaction to the perceived infringement”, Teotia said the government was disappointed and sought a transparent, open and fair position on the issue.
Commerce minister Nirmala Sitharaman had subsequently declared negotiations would start soon but nothing had materialised.
Teaotia however quashed all reports of the two sides continuing negotiations in secret, saying no negotiations have been underway for the last three years.
The FTA is aimed at reducing or significantly eliminating tariffs on goods, facilitation of trade in services and boosting of investments between the two sides.
Besides demanding significant duty cuts in automobiles, EU wants tax reduction in wines and spirits and dairy products and a strong intellectual property regime.
The two-way commerce in goods between India and the EU stood at $ 98.5 billion in 2014-15.