Small gap posing difficulty in finalising India-EU FTA : Rao
New Delhi: The government on Tuesday said "small gap" is posing problems for conclusion of the proposed India-EU Free Trade Agreement (FTA) that will drastically cut duties on most of the items traded between the two nations.
Asked by when the proposed India-EU FTA is expected to be finalised, Commerce Secretary S R Rao said, "All I can say is we are extremely close to the finalisation, but small gap is also becoming very difficult."
At the moment, inter-sectional meetings are taking place, he told reporters on the sidelines of an Assocham function here.
India and the 27-nation bloc European Union (EU) are negotiating a Broad-based Trade and Investment Agreement (BTIA) since June 2007, but no breakthrough has yet been achieved due to strong differences on several of the issues.
Last week, India had asked European Union to address its concerns on providing data secure status for the IT industry under the pact, to which EU has expressed willingness to set up a Joint Working Group (JWG) to look into these issues.
India's concerns were conveyed by Commerce and Industry Minister Anand Sharma to EU Trade Commissioner Karel De Gucht when the two met on the sidelines of an OECD meeting in Paris on May 30. During the meeting, they also reviewed the current status of the India-European Union BTIA negotiations.
The two sides have failed to bridge the gap on various crucial issues, including increase in FDI in insurance sector by India and granting of the status of data secure nation by the European Union during the talks between their Chief Negotiators in May.
Data-secure status is a big demand of India as its current lack of status has prevented the flow of sensitive information to India, a big deal for its IT industry.
This has also impacted the movement of people through restrictions on business development as it restricts transfer of personal data to locations outside EU, unless the importing country ensures adequate data protection.
India has been arguing that since US has a safe harbour pact with the EU, and that the US and India have a data adequacy agreement, therefore the EU should give data adequacy status to India.
Also, it wants liberalised visa norms for its professionals and market access in services and pharmaceuticals sector.
On the other hand, EU is pressing for duty cuts in automobiles, wines, spirits and dairy products, hike in FDI cap in the insurance sector and a strong intellectual property regime.
Total trade between India and the EU stood at USD 94.43 billion during April-February 2012-13. It aggregated to USD 109.86 billion in 2011-12.