India-EU Trade Deal To Benefit Textile, Garment Exporters.

European Union negotiators arrive in Delhi today to continue the final leg of talks.

The much-awaited trade deal between India and the 27-nation European Union (EU) is likely to benefit the exporters of textile and readymade garments the most. The negotiations have reached a final stage to iron out some of the differences that still exist.

On Monday, EU negotiators are arriving here to continue the final leg of talks that started on July 13 in Brussels. However, the negotiations have already missed the April deadline, by which time it was expected to be agreed upon by both the negotiating parties officially.

“Once the deal is agreed upon, the EU would take six months to have the deal ratified from the EU parliament,” said commerce secretary Rahul Khullar.

The delay had taken place due to stiff differences between both sides over issues such as opening of India’s auto market with significant tariff reduction, duties on imported wine and spirits, the EU’s insistence on stricter policy for intellectual property rights (IPR), particularly in drugs and pharmaceutical products and its consent to the provisions under the Anti-Counterfeit Trade Agreement (ACTA).

But according to senior officials in the ministry of commerce and industry, the sector that stands to gain the maximum benefit out of this trade deal is textiles and readymade garments. The department of commerce had earlier raised the issue of the EU imposing several non-tariff barriers (NTBs) against textiles and garments exports from India.

The EU had been imposing various NTBs on the import of textiles and garments from India such as labelling certification, registration, evaluation, authorisation and restriction of chemical substances.

Hence, the department had been working closely with the ministry of textiles to develop a common compliance code to empower the textiles industry.

As much as 90 per cent of the bilateral trade in goods and services would be covered under the pact. While EU had been demanding greater access into our markets for its products, with significant tariff reductions, India had been demanding greater opening and job opportunities for professionals like doctors, nurses, chefs, accountants who would be to travel to the EU countries with a relaxation in the visa regime. The agreement will lead to increased opportunities for market access in both goods and services for each other, according to Sharma. Talks to initiate the free trade agreement started in June 2007 and there had been 12 ministerial-level negotiations in New Delhi and Brussels. EU is one of the leading trade partners for India, with bilateral trade in excess of $85 billion. Both sides have set a target of scaling it up to $200 billion by 2013.

Source : sify.com