On Saturday, the Ministry of Commerce and Industry said India and the European Union (EU) had restarted free trade agreement (FTA) talks after nine years.

Negotiations restarted on June 17 at an event at EU headquarters in Brussels. India’s Commerce and Industry Minister Piyush Goyal and European Commission Executive Vice-President Valdis Dombrovskis officially restarted negotiations on the India-Europe Free Trade Agreement (FTA).

In addition, the Ministry of Commerce and Industry said in a statement that negotiations on the Independent Investment Protection Agreement (IPA) and Geographic Indicators (GIs) Agreement have also been initiated.
The first round of negotiations on the Indo-European FTA is scheduled to start in New Delhi on June 27.

This will be one of the most important FTA for India as the EU is its second-largest trading partner after the US. In 2021-22, the trade volume of goods between India and Europe will hit a record high of $116.36 billion, a year-on-year increase of 43.5%. In 2021-22, India’s exports to the EU will grow by 57% to $65 billion. India has a trade surplus with the EU.

On May 8, 2021, during the India-EU leaders meeting in Porto, an agreement was reached on restoring a balanced, ambitious, comprehensive and mutually beneficial FTA, and a new one on the IPA and a separate GI agreement was launched in negotiation.

“The two sides are now resuming FTA negotiations after talks earlier in 2013 were interrupted for about nine years due to differences in the scope and expectations of the agreement,” the Ministry of Commerce and Industry said.
European Commission President Ursula von der Leyen’s April 2022 visit to New Delhi and Prime Minister Narendra Modi‘s recent visit to Europe have accelerated discussions on FTAs and helped shape a clear negotiations route map.

Considering that both parties share similar fundamental values and common interests and are the two largest open market economies, this FTA will help diversify and secure supply chains, increase economic opportunity for our businesses, serve our people provide more economic opportunities and bring significant benefits. The two sides hope that the trade negotiations will be based on a broad, balanced and comprehensive basis on the principle of fairness and reciprocity. There will also be discussions on addressing market access issues that hinder bilateral trade.

While the proposed IPA will provide a legal framework for cross-border investment to enhance investor confidence, the GI agreement is expected to create a transparent and predictable regulatory environment to facilitate the adoption of GI products, including handicrafts and agricultural products.

The goal of both parties is to negotiate all three agreements at the same time and reach them at the same time. The first round of negotiations for all three agreements will be held in New Delhi from June 27 to July 1, 2022.

Earlier this year, India concluded FTAs with Australia and the UAE in record time. Negotiations for FTAs with Canada and the UK are also underway. The FTA negotiations are part of India’s broader strategy to establish balanced trade agreements with major economies and amend existing ones to improve trade and investment.