HOPES of India and the European Union striking a free trade deal at a summit this week are fading fast, with differences over duties on cars and market access for software and service companies standing in the way of an accord.!
At stake is an agreement that would create one of the world's largest free-trade zones by population covering 1.8 billion, or more than a quarter, of the world's people.!
Disagreement over duties on car imports, India's tariff on European cars is nearly 10 times greater than Europe's on Indian vehicles, and a dispute over access for Indian software companies to the EU market are set to scupper an agreement, with time running out on negotiations.!
EU leaders will meet their Indian counterparts in New Delhi on Feb 10, having declared at a summit last year that they hoped to sign a free-trade deal before the meeting.!
Publicly, officials in both Brussels and New Delhi are remaining upbeat.!
But not everyone is hopeful. The EU ambassador to India suggested in January that the best that could be expected from the summit was a "political framework" for a deal further down the road, without a timeline being set. !
For India, an Free Trade Agreement would help its rapidly growing companies expand into the EU, the country's biggest trade partner, the buyer of more than 40 billion euros (US$52 billion) worth of Indian goods and services in 2010. Europe, large parts of which probably sank into another recession last quarter, wants access to a vast, young, vibrant market of 1.3 billion potential customers.
Reuters
In this file photo, visitors look at the newly launched Mercedes-Benz concept A during the 2012 India Auto Expo in New Delhi on January 5, 2012. Picture: AFP
Tuesday, February 7, 2012
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