Bridges Weekly Trade News Digest • Volume 14 • Number 7 • 24th February 2010
British Minister Wants EU-India FTA Finalised This Year
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British International Development Minister Gareth Thomas exhorted the European Union and India to finish negotiations on a long-delayed free trade agreement (FTA) by the end of 2010 at a meeting in Brussels on Monday.
Britain is pushing for a swift conclusion to the negotiations begun in 2007 because it claims the delay is slowing trade and employment in both countries. Several weeks ago, British Business Secretary Peter Mandelson likewise advised the Indian Commerce Minister Anand Sharma that India must focus on rapid completion of the agreement.
“The negotiations are progressing very slowly, and I would urge all those round the table to do everything in their power to ensure that discussion in 2010 do not get stuck in the weeds as we pursue a positive outcome,” Thomas said in Brussels.
The negotiations have gone through eight rounds of negotiations so far, the most recent taking place in Mumbai at the beginning of February.
The free movement of workers is a particularly contentious issue. The Indian government has protested how difficult it is for its workers, including those with professional experience, to emigrate to the EU. India has demanded that EU borders be opened to skilled IT workers, offering in return a similar arrangement for EU legal professionals to work in India.
With the WTO’s Doha trade talks stuck in neutral, the United Kingdom sees an EU-India free trade agreement as an alternative way to encourage trade liberalisation. “In lieu of a final agreement on the Doha trade round, it is important to have an agreement in place that protects jobs by creating more opportunities for increased trade,” Thomas said.
The EU has been advocating the 2010 deadline for some time. Last March, the European Parliament’s Trade Committee issued a report expressing disappointment with the slow pace of negotiations and emphasising the importance of finalising the agreement by 2010. Catherine Ashton, former EU Trade Commissioner and now the bloc’s top foreign affairs representative, has kept the India talks high on her list of priorities.
The EU is India’s largest trading partner, accounting for 18.7 percent of India’s exports. Trade between India and the EU is worth more than €55 billion each year to the 27-nation EU.
British interest in the agreement is especially keen as 17.7 percent of Indian exports are destined for the UK.
“The benefits of an EU-India trade deal would be felt by businesses on both sides,” said Thomas. “This in turn will benefit millions of people whose employment relies on the import and export trade.”
However, criticisms of the potential effect of the trade deal on India have been raised. In a column the Guardian in November, journalist David Cronin condemned the EU for trying to force India to cede control of its banking sector and to accept overly stringent intellectual property standards.
“India’s poor have every right to be incensed at how their government is being pushed into signing trade agreements that are inimical to their interests,” wrote Cronin.
Some have also criticised the EU for allegedly having secret discussions with BusinessEurope, a group representing some of the world’s largest corporations, in preparation for pressuring India into dropping all domestic industry protection measures. However, European Commission spokesman John Clancy rejected these claims, saying that BusinessEurope had been given no “privileged treatment.”
ICTSD reporting; “UK wants India-EU trade deal by 2010 to protect jobs, increase trade,” TIMES OF INDIA, 23 February 2010, “With jobs at stake, Britain wants India-EU trade deal by 2010,” CALCUTTA TUBE, 23 February 2010; “EU tramples on India’s poor,” GUARDIAN, 6 November 2009; “EU pushes to prise open India,” ASIA TIMES, 12 February 2010.
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Free Trade throughout a greedy for profit world will mean that all work goes to the cheapest provider in the third world under cutting the economic stability of the west. World democracy with a level playing field would however mean a fairer distribution of wealth. Let’s start here with greedy Bankers giving their excessive bonuses to underpaid and over worked engineers keeping them in business.