The proposed India-EU Free Trade Agreement (FTA) will benefit both the sides and spur two-way trade, the Ministry of Heavy Industry said Friday.
New Delhi: The proposed India-EU Free Trade Agreement (FTA) will benefit both the sides and spur two-way trade, the Ministry of Heavy Industry said Friday.
"The recent developments in the India-EU FTA will further facilitate trade between the two sides and will benefit the industries, service providers and the markets," said an official release, quoting Heavy Industry Minister Praful Patel.
He was speaking at the IAA (Internationale Automobil- Ausstellung) India Day 2013 held at Frankfurt in Germany.
In May 2013, the chief negotiators' from both the sides met but failed to bridge "substantial gaps" on crucial issues, including auto, insurance and data security status for IT sector.
Negotiations for the Broadbased Trade and Investment Agreement (BTIA) between India and the 27-nation European Union bloc were launched in June 2007, but have been facing many hurdles.
Patel said the importance of increasing trade in the globalised economy has been acknowledged in India and it has actively supported bilateral and multilateral pacts.
One of the contentious issues between the two sides is cut on import duties on cars from the EU. Earlier, the ministry had demanded that import duties on cars from the EU should not be cut so as to protect the domestic industry.
EU has been pushing for reduction in import duties by India as car makers in the continent struggle with excess capacities and reducing sales due to the economic uncertainty.
India's auto sector too has seen a slowdown. While car makers struggled, two-wheeler makers such as Hero MotoCorp and Honda Motorcycle and Scooter India reported sales growth in August this year.
According to the data by the Society of Indian Automobile Manufacturers, car sales fell for a record ninth month in a row in July, declining 7.4 percent, as the economic slowdown and low consumer sentiment hit demand. Vehicle sales across all categories dropped 2.08 percent to 14,15,102 units in July 2013 from 14,45,112 units a year earlier.
Last month, however, saw an uptick but the industry body has warned that tough market conditions still remain. Interest rates are high, fuel prices continue to be high while sentiments are extremely low,
Overall, meanwhile, the total trade between India and EU stood at USD 94.43 billion during April-February 2012-13. It was USD 109.86 billion for the entire 2011-12 fiscal.
Both sides are keen on pushing the two-way trade and want to conclude the FTA that has been in the works since 2007.