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      India, EU to further trade partnership

      Posted AtBusiness Standard

      There is a shift of sovereignty in the trade policy with the formation of the European Union (EU)" said Mariella Cantagalli, first secretary, Trade and Economic section of the Delegation of European Commission.

      Mariella was here to talk about the Indo-EU trade partnership both from bilateral and multilateral trade relations.

      Making a presentation on 'Business Opportunities in EU' here at The Federation of Andhra Pradesh Chambers of Commerce and Industry (Fapcci), she said the delegation is here to negotiate on behalf of the 25-member states as they cannot have an autonomous trade policy of their own.

      India is an important trade and investment partner, accounting for 24 per cent of exports and 17 per cent of imports to the European Union in 2004, she said adding, EU was one of the biggest partners accounting to 14 per cent of the FDI inflows into India.

      Cantagalli said the challenge was that though EU was India's largest trading partner, it ranked 14th accounting for only 1.7 per cent of EU exports and 1.6 per cent of EU imports and that India was relatively a closed market despite economic reforms resulting in impressive growth and liberalisation.

      She said that under generalised system of preferences (GSP) based on the unilateral preferences created by the United Nations in 1960s, India in 2004 became the first beneficiary of GSP, displacing even China out of 180 countries with a 6.9 bn euro exports to the EU.

      EU has just revised its GSP scheme and India would benefit from a wider coverage nearing about 7,200 products, she said.

      The simplified scheme of GSP will be effective from Jan 1, 2006. India would enjoy a status quo situation in textiles and clothing, she said. Finance, IT, textiles, pharmaceuticals and bio-technology and agro-food processing were some of the key sectors, she said, that can be look forward to for enhancing trade growth.

      The EU, as a dominant voting member of the World Trade Organisation, has prioritised multilateral route in its relations with biggest trading partners, Cantagalli said pointing to the multilateral scenario.

      She delineated the various framework agreements based on the Doha Development Agenda (DDA) in agriculture, trade facilitation, industrial products and services and the areas where there was a need to negotiate and expedite.

      Among various things in strengthening relationship between the EU and India that includes exploring bilateral cooperation on Geographical Indicators (GI), Cantagalli said that the success of the DDA process was crucial to build on the bilateral developments between the two partners.

      The Delegation of European Commission is a formal body representing the EU in India, Nepal, Bhutan, Sri Lanka and Maldives.

      July 21, 2005


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