| Date: |
25-01-2014 |
| Subject: |
India rejects EU demand for zero-duty auto imports |
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NEW DELHI: The European Union has put a fresh spoke in the proposed trade agreement with India, seeking zero-duty import of automobiles, a demand the government has dismissed ahead of the elections. In addition, the 28-member grouping wants further customs duty removal for 29 auto components, again a no-go area given domestic sensitivities.
Sources said EU has shown little interest in going ahead with signing a deal and is now reopening settled issues in what many see as an attempt to delay the agreement that has been under negotiation for over seven years now. While the government has ruled out immediate withdrawal of duties, it wants to keep the EU engaged and has suggested that the issue can be taken up when the treaty is periodically reviewed.
For instance, the trading bloc has suggested that it will review its offer for concessions that it was willing to give for chemicals exported from India, arguing that New Delhi is not opening up its market sufficiently by reducing or removing import levies. "What EU is doing is ignoring our demands even when we have decided to open up 96% of the products, which is higher than what we have offered to any other trading partner," said a source.
The sources pointed out that EU has so far ignored India's repeated demand for grant of data adequacy status and the consultations at the technical group level have not even commenced. A growing view in the government is that EU is only interested in pocketing the gains as it has shown little willingness to open up the market for Indian professionals by making the visa regime simpler.
Officials said that there are concerns over a safeguard clause in the agreement, which will allow the member countries to suspend the benefits once 20% of the sectoral quota is reached. So, if, say, 5,000 IT professionals get access to one of the markets against a quota of 20,000, the country can deny permits to the other applicants even when it has committed to allow more professionals.
Source : timesofindia.indiatimes.com
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