Countries and regions
The EU and India are committed to further increase their trade flows in both goods and services as well as bilateral investment and access to public procurement through the Free Trade Agreement negotiations that were launched in 2007.
Substantial progress has been made so far, and key areas that need to be further discussed include improved market access for some goods and services, government procurement and geographical indications, and sustainable development.
- India is an important trade partner for the EU and an emerging global economic power. The country combines a sizable and growing market of more than 1 billion people.
- The value of EU-India trade grew from €28.6 billion in 2003 to €72.7 billion in 2013.
- EU investment stock in India grew substantially reaching €41.8 billion in 2012.
- Trade in commercial services quadrupled in the past decade, increasing from €5.2billion in 2002 to €22.7 billion in 2012.
EU-India "trade in goods" statistics
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EU-India "trade in services" statistics
|Year||EU imports||EU exports||Balance|
Foreign direct investment
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EU and India
Dismantling trade barriers in India
The European Commission's Trade and Investments Barriers Report, published in March 2014, points out that some progress has been made to dismantle trade barriers in India.
- India suspended the implementation of some aspects the preferential procurement policies for domestically manufactured electronic goods and telecom products due to security considerations that would have been be applied in a mandatory manner for both public and most importantly private purchasing entities (e.g. telecom services operators). For electronics products, India has on 23 December 2013 adopted a new preference policy which indeed drops security reasons and only addresses public procurement.
- Regarding mandatory compliance of steel products with new national standards and certification by the Bureau of Indian Standards (BIS), the date of entry into force of mandatory certification requirements for certain steel products was shifted to April 2014 and beyond. In addition, in August 2013, some products that are directly supplied for major projects subject to some conditions were exempted from the certification scheme.
- India has also formally extended a grace period for the compulsory registration of 15 categories of IT and consumer electronics goods
- • India introduced some changes in investment rules and opened the possibility for 100% foreign ownership in the telecoms sector; in addition, more recently the Government expressed the intention of raising FDI limits in defence manufacturing from the current 26% to 49%, while a similar approach in the field of insurance companies was not adopted by the Parliament.
- There was also a positive development insingle-brand retail investments. Following the opening of the sector, some European companies have already applied for and received licences. A European company has also applied for a multi-brand retail license, the first for a foreign company in India.
EU-India trade negotiations
The negotiations cover:
- access to each other's markets, for goods, services and to public procurement contracts,
- the framework for investment
- the rules that frame trade, such as intellectual property and competition
- sustainable development, growth in trade is in tandem with the environment, social and labour rights.
India has embarked on a process of economic reform and progressive integration with the global economy that aims to put it on a path of rapid and sustained growth. However, India's trade regime and regulatory environment remains comparatively restrictive (for example see the World Bank's Ease of Doing Business Index). India still maintains substantial tariff and non-tariff barriers that hinder trade with the EU. In addition to tariff barriers to imports, India also imposes a number of non-tariff barriers in the form of quantitative restrictions, import licensing, mandatory testing and certification for a large number of products, as well as complicated and lengthy customs procedures.
With its combination of rapid growth, complementary trade baskets and relatively high market protection, India is an obvious partner for a free trade agreement (FTA) for the EU.
The parameters for an ambitious FTA were set out in the report of the EU-India High Level Trade Group in October 2006, which was tasked with assessing the viability of an FTA between the EU and India. Other studies have reinforced the economic potential of an FTA between the EU and India, notably a sustainability impact assessment was carried out by the EU.
Negotiations for a comprehensive FTA were started in June 2007 and are ongoing. This would be one of the most significant trade agreements, touching the lives of 1.7 billion people.
India enjoys trade preferences with the EU under the Generalised Scheme of Preferences.
To assist India in its efforts to better integrate into the world economy – with a view to further enhancing bilateral trade and investment ties – the EU is providing trade related technical assistance to India. This is part of the EU's assistance programmes with India.
Trading with India
- Importing into the EU from India
- EU trade defence measures on imports from India
- Exporting from the EU to India
- The EU is present on the ground in India
- Trade relations are part of the EU's overall political and economic relations with India
- European Business and Technology Centre, India
- India is a member of the World Trade Organisation