EU-India Bilateral Trade and Investment Agreement: Opportunities and Challenges

Abstract

India has a long history of economic linkages with the EU member states. In recent period, the volumes of Indo-EU trade both in case of merchandise products and services have considerably increased and a number of investment collaboration opportunities are emerging. Since 2007 the two sides are engaged in the negotiations on concluding a Bilateral Trade and Investment Agreement (BTIA), which is expected to augment the present level of economic exchange further. Once completed in coming months, the BTIA will be the biggest trade agreement involving India, surpassing its earlier RTA with the ASEAN countries. However, while EU and India can collaborate in several spheres, the potential conflict of interest may not be uncommon either. In particular, the provision of farm subsidies offered by the EU to local producers, imposition of anti-dumping measures on several Indian export categories in EU markets, barriers on movement of professionals, EU interest in inclusion of several WTO-Plus provisions in the agreement etc. are among the concern areas of India. By looking at the trade data and the negotiating dynamics, the present analysis attempts to understand the challenges and opportunities for India in the EU market. The paper concludes that India needs to focus on augmenting its competitiveness for benefiting from the integration exercise.