India and the European Union (EU) are working towards a balanced, ambitious, comprehensive and mutually beneficial free trade agreement (FTA), said the ministry of commerce and industry in a statement on Thursday.
The statement said that while discussing the pact with a European Commission delegation, commerce and industry minister Piyush Goyal emphasised the need for political direction to achieve a commercially meaningful deal while addressing mutual sensitivities.
India and the EU have held nine rounds of negotiations. The latest round, held from 23 to 27 September 2024, made limited headway on key issues, such as rules of origin and government procurement.
The next round is expected in the first quarter of 2025.
The meeting, attended by the minister of state for commerce and industry Jitin Prasada and senior officials, highlighted the growing proximity and trade ties between India and the EU.
Goyal stressed the principle of common but differentiated responsibilities (CBDR) in sustainability discussions, noting that measures should account for the differing paths of development between India and the EU.
The minister said India’s economy is expected to grow 7-8% to become the third largest economy in the world over the next few years, with the country’s GDP expected to hit $35 trillion by 2047.
The EU, India’s largest trading partner in goods, accounted for bilateral trade worth $137.41 billion in 2023-24. Services trade added another $51.45 billion in 2023, reflecting the economic potential of a robust FTA.
Acknowledging the untapped opportunities, EU representatives emphasised that integrating the two economies could yield substantial gains, including resilient supply chains and enhanced market access.
India has intensified efforts to forge balanced trade agreements with major economies to diversify its exports and increase its global trade share. With the EU being the second bloc, after the US, to establish a Trade and Technology Council with India, the partnership signals a strategic convergence beyond trade.
With India’s focus on achieving a $2 trillion export target by 2030, the FTA could be a cornerstone for expanding its share in global trade. Additionally, given the EU’s concerns over sustainability, negotiations will likely test the two sides’ ability to find common ground on climate commitments.
Ambassadors of the European Commission delegation and representatives from Austria, Belgium, Bulgaria, the Czech Republic, Estonia, Italy, Ireland, Latvia, Lithuania, Malta, Poland, Portugal, Romania, the Slovak Republic, Spain, and Sweden were present along with India’s commerce and DPIIT secretary.
