New Delhi: After a gap of seven years, India and the 27-nation bloc European Union (EU) have agreed to resume the pending bilateral trade talks during the annual summit held virtually. They also vowed to have “closer” security cooperation under the Indo-Pacific strategic initiative.
The summit was held Saturday between Prime Minister Narendra Modi and Charles Michel, President, European Council (which defines the EU’s overall political direction and priorities) and Ursula Von der Leyen, President, European Commission (EU’s executive branch).
However, for the first time, leaders of all 27 member states also attended the summit this year.
India and the EU also decided to launch negotiations for having a standalone investment protection agreement after the Modi government cancelled all individual investment treaties with EU member countries in April 2016 as New Delhi came out with a new model, the Bilateral Investment Treaty.
India and the EU began the negotiations for having a free trade agreement, officially called Broad-based Trade and Investment Agreement (BTIA), in 2007. Both sides held the last round of talks in 2013 under the previous United Progressive Alliance government.
“We agreed to resume negotiations for a balanced, ambitious, comprehensive and mutually beneficial trade agreement that would respond to the current challenges. We agreed that in order to create the required positive dynamic for negotiations, it is imperative to find solutions to long-standing market access issues,” said the joint statement issued after the meeting.
“We also agreed to the launch of negotiations on a stand-alone investment protection agreement,” the statement said.
In a series of tweets, PM Modi “welcomed the resumption of negotiations for Trade and Investment Agreements, as well as our new Connectivity Partnership”.
“Our collaboration is essential to stopping the Covid-19 pandemic and ensuring a sustainable and inclusive recovery in a more digital and greener world,” he said.
Taking forward the commitment to transform India-EU relationship for global good, I had a virtual interaction with all leaders of EU Member States and Presidents @CharlesMichel @eucopresident and @vonderleyen for India-EU Leaders' Meeting.
— Narendra Modi (@narendramodi) May 8, 2021
Also read: In joint op-ed, PM Modi, Portuguese PM Costa say India’s global power set to expand
‘Two pacts made to move forward rapidly’
European Commission President Ursula Von der Leyen said since 2013 till now “nothing happened” in the trade talks that got stuck as the Modi government came to power and wanted to begin the talks afresh.
Responding to a question by ThePrint at a virtual press conference, Von der Leyen said the decision to have two separate pacts on trade and investment was done so that “we move forward rapidly and this is for us, I think, a way to approach it so that all different sides have the most benefit from”.
When the trade talks got suspended in 2013, India and the EU differed widely on Brussels’ demand for reduction, and in some cases even elimination, of tariffs on wine and spirits and automobiles even as New Delhi demanded relaxation on the movement of professionals. Greater market access for each other’s dairy products was also one of the sticky points.
There were also differences on whether or not to club the investment protection agreement with the BTIA.
According to Vikas Swarup, Secretary (West), Ministry of External Affairs, the resumption now of the trade talks and investment pacts will be decided between Commerce and Industry Minister Piyush Goyal and EU Trade Commissioner Valdis Dombrovskis, who co-chairs the India-EU High-Level Dialogue on trade and investments.
“All outstanding issues whether it is dairy or treatment of Indian workers, access for our dairy products and agriculture products to the EU, I think all these issues will be on the agenda as and when the trade negotiations resume, which will be decided by the high-level dialogue,” Swarup said.
Both sides also revived the India-EU Human Rights Dialogue Saturday after a gap of eight years.
Also read: Harsh Vardhan interacts with American counterpart, US assures India help to fight Covid
Indo-Pacific region is key for EU
The EU finally came out with its own Indo-Pacific strategy in April 2021 even as it continues to challenge the might of China and assert a larger role in the region. Three of the member countries of the EU — France, Germany and the Netherlands had come out with their strategy for the region before.
“It’s certainly for the European Union, this region is very important, we would like to strengthen the ties with this region that’s why this meeting with Prime Minister Modi was so important today,” said EC President Charles Michel.
PM Modi had raised the issue of border standoff with China during last year’s summit which took place in July 2020, in the aftermath of the Galwan Valley incident in which 20 Indian soldiers were killed by the Chinese Army.
WTO TRIPS waiver on Covid vaccines
On the issue of waiver of TRIPS on Covid vaccines and other products related to it, the EU reiterated that it is willing to discuss the matter at the World Trade Organisation as it seeks to have a “360-degree view of the matter”.
“But right now the immediate need is to make vaccines available,” said Von der Leyen.
Also read: Jaishankar concludes UK visit with message of convergence after 2030 Roadmap agreement