After a two-year lull when both sides went into election mode, there are clear signs that India and the European Union are moving towards the resumption of talks on a Free Trade Agreement. EU Trade Commissioner Cecilia Malmström has written to her counterpart to explore the prospects of getting back around the table. Indian Commerce Minister Nirmala Sitharaman says New Delhi is ready to talk. Both sides are making conciliatory noises on tricky issues like IT services, pharmaceuticals, insurance and booze.

Stakes are high. The EU is India’s biggest trading partner, and two-way commerce is valued at around €93 billion. With a combined market of 1.8 billion people, India and the EU would form one of the world’s biggest free trade zones. This month’s visit to Germany and France by Indian Prime Minister Narendra Modi is an opportunity to take things forward – even though he’s dropped Brussels from the agenda of his European tour.

Is the time now ripe for negotiations to resume? Will opening up trade bring the benefits promised by negotiators on both sides? Or are critics right when they claim workers, small farmers, local traders and healthcare patients will all lose out in a free trade deal designed to benefit big business?

Contributor PJ likes the FTA idea and wrote asking about the chances of striking a deal during the term of the current EU Commission. We put his question to EU Trade Commissioner Cecilia Malmström to find out where things stand.

With Europe’s economy struggling to avoid stagnation, wouldn’t India be better off focusing efforts on improving trade ties with China and other faster growing powers? We put that question to Suhail Nathani, a trade expert and founding partner of the Economic Laws Practice based in Mumbai.

The we asked the same question to Michael Siebert, Germany’s Consul General to India. Does he think India should put trade negotiations with Europe on halt for now and better focus on relations with China?

SiebertOne does not exclude the other I would say. Of course India must be interested in China economically, but why shouldn’t it be interested in dealing with Europe? Europe is in the end its first and foremost trading partner and its main investor. So Europe is very interesting for India, also as a partner for technology and technology transfer. In the end you must ask Indian companies and industries and government whether they are interested. Maybe I can give a small example – the trade exports from India to the EU are around 40 billion USD a year. That is very substantial, that is much more than other countries. A Free Trade Agreement would cause a 5% increase in these 40 billion. This would be two billion USD of extra exports to the EU per year. That is one third or even more of India’s whole trade with Japan – just to put it into scale… I’m sure India is interested.

What do you think? Will a free trade deal inject new life into Europe’s struggling economies? Can India afford to stand on the sidelines as negotiations for trans-Atlantic and trans-Pacific free trade deals rewrite the rules of world commerce? Will a deal leave Indian businesses at the mercy of multinationals? How will an FTA affect European standards on labour rights, food safety or environment protection? Let us know your thoughts and comments in the form below, and we’ll take them to policy-makers and experts for their reactions.



89 comments Post a commentcomment


  1. avatar
    Savvas Patsalos

    This will most probably act as the toomb stone for the manufacturing industry of central Europe..

    • avatar
      Tarquin Farquhar

      @Ivan Burrows
      WELL SAID!

  2. avatar
    Carles Manrique Pérez

    No before they don’t become civilized and treat their workers as human beings and the EU stops cooperating with slave labour employers.

    • avatar
      apps

      …superb so a bunch of ‘not so long ago’ colonizers , so called impireal powers should try to lecture a democracy (apparently the world’s largest) of being civil , little hypocrite aren’t we? considering most of what constitutes EU has being under shorter democratic or even liberal than India ……
      but who cares , Europeans are rich & so we lecture others

    • avatar
      Tarquin Farquhar

      @Carles Manrique Pérez
      I remember people saying similar when Portugal, Spain and Greece joined the EC.

    • avatar
      Tarquin Farquhar

      Breogán Costa
      Why?

  3. avatar
    Sergio Rodrigues

    We have more important internal things to solve before that.something like that will only benefit the milionairs.

  4. avatar
    Jude De Froissard

    Sure….by all means…. but make europeans work first…..and to tell you the truth….i prefer indians to chinese..they are closer tu us.

  5. avatar
    Marco Vento

    Until India don’t bring the two italian soldiers to Italy, Europe will not sign anything with India!

  6. avatar
    Miguel Vieira

    If the intention is to destroy the European middle class, our economy, enrich more and more the 0,6%, corporations and big banks and eradicate small and medium enterprises, yes they’re doing a good work, is very simple, comparing what happened between US and China, US were a creditor nation, strong economy, strong middle class, “happy country”, now are a debtor country, with higher budget and trade deficits, social and economic standards falling apart, China buys and keep gold, their economy grows, social and economic data getting better, USA and EU are selling their goods and increasing public and private debt, the disappearing of middle class, unemployment, poverty, social conflicts, higher immigration numbers, this looks right? Is in the EU best interests? I don’t think so..

  7. avatar
    Nando Aidos

    What does it entail? To the EU? To India? What goals is it trying to accomplish? Are we into more of the “good old price and wage wars to the bottom”? Can someone explain?

  8. avatar
    nando

    What does it entail? To the EU? To India? What goals is it trying to accomplish? Are we into one more of the “good old price and wage wars to the bottom”? Can someone explain?

  9. avatar
    Alex Bell

    We need to break free from USA and from NATO. We need to form EMJF “European Military Joint Forces”

    • avatar
      Paul X

      Those who continue to cry out for a joint EU army clearly have no experience of anything military

      EU army?, so who is going to be in charge of it? who is going to authorise it’s deployment? You have enough rivalry between the army/navy/air force within one country without multiplying this throughout all EU countries with their nationalistic self interests

      The EU interfering in national politics and trade is one thing but sending peoples sons and daughters off to get killed is completely different ball game and one the EU is neither mature or experienced enough to trust with

  10. avatar
    Harald Heidegger

    Why is it that we need a trade agreement with every single person on the planet? Why can’t we establish international rules for trade valid for all countries and nations?

  11. avatar
    Luigi Amoresano

    No free trade agreement with country that doesn’t respect human right. We shouldn’t buy anything from China either.

  12. avatar
    Pedro Redondeiro

    Indeed we should, but having in mind the need to improve human rights. India is a tech-inovation powerhouse, so europe should capitalize on this capability, just like Japan.

  13. avatar
    ironworker

    Is it time to resume negotiations on an EU-India Free Trade Agreement?

    What’s for me in that ? Nothing ? Than NO. (Neo Liberal kind of answer)

  14. avatar
    Emanuele Cristelli

    Until India respect rights of worker and establish rules and salaries for humans and recognize standards of quality and integrity of products…. NO!

  15. avatar
    Paul X

    The problem with an EU trade agreement, like all things EU it will be “one size fits all”

    Unfortunately in the real world (outside the EU bubble), each country has its own import and export priorities and any EU wide agreement while being beneficial to some countries, will no doubt make some much worse off ….but this will not concern Brussels with its endless drive to try and make itself its a major player on the global stage

  16. avatar
    Yordan Vasilev

    Yes, because India is a big market and one country with the biggest growths of the GDP and it will give impulse of the recovery in EU.

  17. avatar
    Antoine Che

    Cool! Like that we could reduce the wages in Europe to the Indian level so we can remain competitive (y)

  18. avatar
    Tarquin Farquhar

    Good idea!

    This will amplify the cries for LANGUAGE UNION ie English as the ONLY official language of the EU.

    German is spoken only in Europe and French is too small a language in terms of vocabulary, demography and influence to be considered the language of the EU.

  19. avatar
    catherine benning

    What a farce this question is. Why not tell it as it is and say this is the ambition of the financial takeover of Globalisation and regardless of what any of us Europeans in the majority feel, this project will go ahead whether we like it or not. We have been sold out by our politicians as they greedily worm their way to the riches they seek by going along with anything that will make it easy for conglomerates to rule.

    Why not, at the same time, tell all European people how this kind of trade agreement will affect their lives and dramatically change their society and way of life by association from the demands that will be placed on them by India, should we agree to this so called trade agreement.

    Lets start here.

    http://www.forbes.com/sites/robertolsen/2010/11/17/tatas-revelation-highlights-indias-culture-of-corruption/

    http://www.iflr.com/Article/3196287/Indian-bribery-and-corruption-exposed.html

    India is a culture of rank outrageous bribary as are many Asian countries we are having to run begging to with our snouts out. It is also a country af the most devastating inequality and prejudice towards its fellow man. They have a class system that the British elite and ruling classes would love to adopt. And it has been brought into my country through mass immigration that should the truth out would be a shocking endictment of our political breed. Idia has a calls called the ‘untouchables’ they are the cleaners of the sewers and to go near them or mix with them turns you into a social outcast.

    These underlying but very rampant social and cultural activities do matter. And they matter a great deal in business.

    So, unless India changes its ways, as South Africa had to, at least on the surface it did, it should be shunned by the world as the pre Mandela SA was. Or, is that only palatable when a white man is in charge?

    http://www2.hu-berlin.de/transcience/Vol5_No1_2014_36_52.pdf

    • avatar
      matthew

      Nobody needs your useless EU trade deal. It’s you fools who need big markets to sell your fucking over priced products. Indian sub continent was a rich and a happy place prior to 7 th Century, with decent life enjoyed by It’s natives and then come the filthy arabs followed by useless Brits who stole all the wealth and since then fault lines got exposed and poor people turned on each other and also few useless rich people started misusing poor people’s life just like their British masters taught them. Immigration and filthy colonizers thoroughly destroyed the sub continent. But tables will turn soon the day west becomes poor filth as it was during medieval times then we will see how much human rights will you people give to each other.

  20. avatar
    EU reform- proactive

    Free trade but fair trade!

    While the EU/Customs Union grapples internally with the theory of “comparative advantage”- (its ‘natural discrimination’ between 28 members)- where each country should specialize in that activity where it has such enviable advantage (over others)- shows how complex it is for the 28 EU/CU members to negotiate as one block with India or any other country- specifically a predator corporate US!

    No FTA rules should be allowed to interfere or overrule any member countries Constitution nor stand above any of the 30 UN agreed basic human rights!

    Food is one of such Human Right. Agriculture therefore must be excluded to guarantee food sovereignty and safeguard all of us from a global corporate take over of: land, patents on Life, GMO’s, ever increasing food prices by bankrupting small farmers & environmental degradation.

  21. avatar
    Selcuk Ipek

    Free trade with India would slaughter many European businesses. Special agreements in primary needs should be acceptable however. It would also be a wise step to change to China policy as well. It is harming many domestic businesses too.

  22. avatar
    Ecs Ferreira

    Eu must have a economic trade mostly with his neybours, nearby, the mediteranian countries, north africa. Their are humaniterian, political and economic interesrs

  23. avatar
    Sharmadha

    The short answer is – of course! However, given the Europe Union’s struggling economies , there maybe a tendency on their part to be more protectionist and oppose such agreements (especially from a political angle). If there is an issue that most economists agree on, it is that – free trade is good and benefits both economies in the long run. Also, here are a set of countries with which India shares a lot of common values – of democracy,free speech and human rights. It is but logical, that India and the EU move forward on negotiations. If it is difficult to negotiate with the EU as a whole, then India must actively engage with EU member countries individually, to push forward bilateral deals.

  24. avatar
    Ivan Burrows

    .

    Of course it is, every country in the world is currently looking for bilateral Free Trade Agreements.

    The question is if every country has them why do we need the EU ?

  25. avatar
    Jason Cotterill-Attaway

    Free trade agreements with USA, India, China…. what was the EU set up for?

    Oh yeah, they were unhappy with the result in 1945 and took it to appeal….

  26. avatar
    fernando cruz

    On the surface it all sounds great. BUT… will the Europeans benefit from the agreement? Will we see employment improve? Will India’s millions see a higher, more dignified standard of living? Or will we end up in yet another price and wage war?
    I have asked this question before and nobody has bothered to answer. It makes very suspicious that the answer will not be favorable to the Europeans or the Indians but only to the “lords of industry”.

  27. avatar
    Nando Aidos

    On the surface it all sounds great. BUT? will the Europeans benefit from the agreement? Will we see employment improve? Will India?s millions see a higher, more dignified standard of living? Or will we end up in yet another price and wage war?
    I have asked this question before and nobody has bothered to answer. It makes me very suspicious that the answer will not be favorable to the Europeans or the Indians but only to the ?lords of industry?.

    Note: my comments are awaiting moderation…

  28. avatar
    Ivan Burrows

    Nando Aidos

    The ?lords of industry? as you call them are the people who create jobs, the question is will those jobs be in India or Eastern Europe ?

  29. avatar
    Rudi Špoljarec

    What do you think about this : unit price in India = 100 $ raw material + 100 $ energy + 5 $ human labor + taxes + wat + etc. =205 $ + etc. confronted with unit price in Europe = 100 $ raw material + 100 $ energy + 100 $ human labor + taxes + wat + etc = 300 $ + etc. According to you , is it free competition ? Don’t make me laugh. Are you going to continue destroying european economy , the destruction began at the begginning of 2000. , now you want to finish it or not ?

  30. avatar
    Adrian Podar

    Of course why not when India has a problem with work safety , human social issues like the cast system and rape let alone the corruption of course talks should resume why not .

  31. avatar
    Breogán Costa

    Why is EU so obsessed with free trade agreements??
    Is it good for our workers?
    I don’t think so…
    Or is just to allow our enterprises to move there and fire their workers in Europe?

  32. avatar
    Harald Heidegger

    We should export our social systems first of all. As long as thousands of Indians are starving and dying of hunger, we do not free trade with them. Set minimum conditions for free trade!

    • avatar
      apps

      the problem here is Mr. Herald , that Indians are starving & dying of hunger since last 60 yrs from previous European exports I.e. colonialism ……
      & in general speaking , social systems ~you could argue Indian democracy state is older & much better than EU system (greece bailout aj example , no indian state can be impaginef to be bailed in such miserable fashion & terms-conditions) Next~ is apparent labour rights , Indians have that but apparently 92% of the population comes under informal sector , so it simply is irreverent in Indian context ….. on rule of law , yeah there is scope for EU & India to learn from one another on handling insurgency & rule of law

  33. avatar
    Sourav Mukherjee

    To all my European friends , don’t be negative about the idea its a great idea for struggling Europe economy to revive. We Indians are your friends & well wishers, we have many resources to offer you. So, grab it.

  34. avatar
    Kush

    It’s funny how the common people in Europe worry that a free trade agreement will destroy their industries while common people in India also worry that the agreement will destroy Indian industries……
    Let’s get one thing understood here, Europe is an engineering and manufacturing powerhouse especially of high tech stuff while India is a services and IT powerhouse. The only area of conflict could be food products…….

    PS : with regards to the marines, law will take its own course. Remember that if it was China or any Middle eastern country those marines would have been executed by now…..

  35. avatar
    apps

    yeah , that’s sound a lot difficult , considering India , a sound democracy with independent judiciary & with a growing attractive economy has put them already on trial …..
    apparently EU can’t even complain of the usual arguments of rule of law in this case either in defense of those murderers

  36. avatar
    apps

    it’s a trade agreement not an a political or social agreement , but i do think indian government must demand from EU include right to medicines against IPRs, immigration rights ,colonial reparations, historic responsibilities of climate change , war crimes ,Doha round recommendations , mutual respect for state sovereignty enshrined in U.N charter etc etc

  37. avatar
    matthew

    Yes as long as Europe can sell more weapons to countries like India and Pakistan and ask them to fight each other, while their people suffer because of corrupt and useless governments EU will have no problems with any trade deals.

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