No schedule yet to restart negotiations on India-EU free trade pact: EU official

The 28-member European Union (EU) is “encouraged” by the political momentum the long-discussed India-EU free trade agreement (FTA) gained at the summit held between the two in Brussels at the end of March, but both sides have not been able to fix a schedule to restart negotiations as yet, an EU official said.Both sides have “outstanding issues” to sort out and “the European Commission offered India on several occasions and in different formats to create an adequate forum to discuss outstanding issues...to enable the process to move forward,” Daniel Rosario, a spokesman for the EU trade department, told a group of visiting Indian journalists on Monday.The last round of talks on India-EU FTA was held in 2013 and the discussions have remained deadlocked on issues such as tariffs on automobiles and wines and spirits, Rosario said.In the auto sector, EU is unhappy given that its exporters have to face Indian import duties of up to 100% on cars and car parts. And in the case of wines and spirits, European exporters face tariffs as high as up to 150%, Rosario said.He said the EU had put forward several proposals in 2013 to break the deadlock.“We suggested long transitional periods for their elimination or going as far as accepting asymmetric elimination of these duties in favour of India” in the case of automobiles, he said. In the case of wines and spirits, “the proposal made in 2013 was for a gradual if not complete elimination of these duties and taking into account the Indian sensitivities”, he said.“We clearly identified the areas where we expect India to make some movement and we offered some fora to go into some specific discussions to allow for the general discussion to move ahead and for the time being, this has not happened,” he added.When asked if the EU would agree to re-open negotiations from the start, Rosario said the EU could not “ignore all the work that has been done so far”.Despite the many contentious issues, “we are encouraged to see that in the last (India-EU) summit at the end of March, both sides agreed to re-engage in this process to give it the necessary momentum”, Rosario said, referring to the 30 March India-EU summit in Brussels. India was represented by Prime Minister Narendra Modi and the EU side was represented by Donald Tusk, president of the European Council and Jean-Claude Juncker, president of the European Commission.But Rosario did not seem to have an answer when asked when the talks will get going again.According to analysts, the trade pact could serve as an “anchor” for bilateral relations, besides proving to European businesses that “India is open for businesses”.The March India-EU summit was the first in four years and followed the EU’s refusal last year to confirm the dates of a proposed visit by Modi amid a diplomatic row over the slow progress in India of the trial of two Italian marines accused of killing two Indian fishermen in 2012.Talks on the Bilateral Trade and Investment Agreement—the official title of the free trade pact—started in 2007 but progress has been tardy and marked by flip-flops. India cancelled a meeting with the EU chief trade negotiator in August last year in protest against an import ban on 700 of its generic drugs clinically tested by GVK Biosciences for alleged manipulation of clinical trials.“The GVK issue, it’s a decision for us that has nothing to do with the negotiations of a trade agreement, it never had a link,” Rosario said.Later, during a meeting between Modi and Tusk in the Turkish city of Antalya in November on the margins of a G-20 meet, both sides agreed to hold a stock taking meeting between the chief negotiators before resuming formal talks. The stock-taking talks, including a meeting between Indian commerce secretary Rita Teaotia and EU Trade Commissioner Cecilia Malmström in Brussels on 22 February, however, did not produce any results.The impression in New Delhi seems to be that with the EU involved in talks with the US on the Transatlantic Trade and Investment Partnership, it is not focused on trade talks with Asia’s third largest economy. Also occupying European mind space is the British referendum, to be held on 23 June, on whether the country should remain in the EU.“There was a long discussion on the trade agreement during the India-EU summit and we have conveyed to them (EU) that we are committed to the agreement,” said a person on the Indian side who is familiar with the developments.On India’s part, disputed issues in the trade talks include the so-called Mode 4, a provision of the 1995 General Agreement on Trade in Services, which seeks to facilitate the movement of professionals from one country to another.According to Shada Islam, director at the Policy Friends of Europe think tank based in Brussels, India-EU ties seemed to be a work in progress with India focused on consolidating ties with countries like the US.“The India-EU relationship is not as vibrant as the EU-China partnership,” she said, adding that the 30 March summit “seemed to be the beginning of a new understanding with misconceptions on their way out”.“At the moment, we (India and the EU) don’t have a strong anchor for our relations and the trade agreement could serve as that anchor,” she said.Total bilateral trade between India and the EU, which is India’s largest trading partner, was €78 billion in 2015, according to EU figures.The EU is one of the largest foreign direct investors in India with investments of €38.5 billion since 2000. 

View from abroad: Xi’s visit to Britain: it’s also about the EU (Originally published 24/10/2015 at Dawn.com)

President Xi Jinping’s recent trip to the United States grabbed global headlines. By going to Britain, the Chinese leader has sent an equally important signal of his interests and determination in deepening and expanding China’s ties with Britain — but also with Europe.Beijing and Washington certainly need to talk to each other on a range of bilateral and international issues. And the Sino-American agreements reached on cybersecurity and climate change will help ease relations between the world’s two leading political and economic actors.But President Xi and Prime Minister Li Keqiang’s many visits to Brussels, Paris and Berlin this year — and now Xi’s high-profile trip to Britain — underline that China and Europe have also made a strategic choice to further develop and expand relations.China’s focus on Europe and on Britain is important for several reasons. Tackling challenges in a multipolar and multi-complex world requires more than cooperation between China and the US. It also demands working in tandem with the European Union and its 28 member states.Britain, given its global role and influence is, of course, especially important. President Xi’s visit, including his high-level meetings, underline to a watching world — and to the rest of Europe — that China still views Britain as a key international player.Significantly, Xi’s visit follows a trip to China by UK Chancellor George Osborne last month, during which he said Britain should be China’s “best partner in the West”.It’s not just Britain that wants closer ties with China, however. Germany remains a strong contender for the title of Beijing’s ‘best friend’ in Europe. And more generally while relations between China and individual EU states are important, ties with the EU are also improving, with the launch of the connectivity platform and the agreement to cooperate on developing 5G networks.Europe certainly has the markets China needs for its exports — and trade is still booming. European expertise and know-how is critically important to help meet China’s urbanisation, climate, innovation and other developmental challenges. Most recently, there is a focus on synergies between the ‘One Belt, One Road’ project and Europe’s own investment blueprint for transport, digital and technology networks. Britain and British companies have a key role to play in such cooperation, both on a bilateral level but also through the EU.True, the EU’s many recent crises have eroded much of its lustre. Last year has been especially difficult as EU leaders have grappled with continuing troubles in the Eurozone, struggled to tackle the influx of refugees fleeing war and conflict in Syria and Africa while also dealing with longer-term problems of low growth and high unemployment.For the next few months, the focus in London, Brussels and in other EU capitals will be on Britain and the country’s upcoming referendum on its membership of the EU.The EU is hoping that Britain will opt to stay in. And while no EU leader would say so in public, many are clearly hoping that President Xi gives a clear but subtle message to British citizens to vote in favour of EU membership. As such, it is especially significant that the Chinese president has met leaders of the opposition parties and parliamentary leaders.But that’s not the only reason that the EU kept a close watch on President Xi’s speeches and meetings in Britain. China-watchers in Brussels and elsewhere in the EU wanted to learn more about the state of the Chinese economy after the market volatility over the summer and what to expect as China’s development priorities in the upcoming 13th Five-Year Plan.Meanwhile, Xi’s speech in London provided further insight into China’s hopes for the internationalisation of the renminbi and also information on China’s priorities as it prepares to take over as chair of the G20.Certainly as in other EU capitals, the focus was on business, with Britain looking for Chinese investments in key projects such as a high speed rail line in the north of the country and a deal on Chinese investments in the Hinkley Point C nuclear plant. The UK is now China’s largest investment destination country in Europe.More investment opportunities for Chinese companies opened up in the railway, energy, aviation and telecommunications industries. Significantly, leading the way for other European countries, Britain joined the Chinese-led Asian Infrastructure Investment Bank (AIIB), despite opposition from Washington, earlier this year. Within the EU, Britain’s opinion is important as the EU and China negotiate their Bilateral Investment Treaty and will be even more important if and when the two sides start discussions on a Free Trade Agreement.There used to be a time not so long ago when China’s friendships with individual EU member states were viewed with suspicion by Brussels. This was especially the case as regards China’s ‘special relationship’ with Germany and the burgeoning ties between Beijing and the Central and Eastern European states. Fortunately, such unease is now mostly over, with many policymakers agreeing that stronger bilateral ties between China and the individual EU member states — including Britain — help to consolidate and deepen the wider EU-China relationship.

View from Abroad: Asia’s affair with US leaves Europe out in the cold (Originally published 8/11/2014 at dawn.com)

America continues to loom large over the Asia-Pacific region. Whether it’s about trade, politics or security, Asian eyes tend to focus almost solely on Washington. Japan, South Korea, Taiwan and the Philippines feel safer under the US security umbrella. India wants to forge a stronger relationship with Washington. Even China, the region’s most economically vibrant and powerful nation, seeks a special “great power” relationship with America.Hence the focus on the US-led Asia-Pacific Economic Cooperation summit opening in two-day Beijing on Nov 10 and the East Asia Summit from Nov 13-14 in Naypyidaw, Myanmar. A few days later, the spotlight will move to Brisbane, Australia, for the G20 summit.Certainly, the APEC agenda is impressive, with leaders expected to agree to a study on negotiating a Free Trade Area of the Asia-Pacific (FTAAP). But Asia’s enduring affair with America leaves only a small space for an Asia-Europe relationship.Significantly, Europeans will be absent from the jamboree in Beijing. The EU has been pressing for entry into the EAS which now also includes the US and Russia but Asians are in no hurry to open the door.Some European countries and the European Commission will, however, participate in the G20 meeting.And yet, there is more to the Asia-Europe relationship than meets the eye. America’s so-called “pivot” to Asia may have grabbed the headlines, but the EU has spent the last three and a half years upping its own game in Asia.The Asia-Europe Meeting (ASEM) held in Milan last month is a case in point. The summit may not have made headlines worldwide but over 50 European and Asian leaders made an array of pledges on boosting growth, continuing economic and financial reform and building stronger Europe-Asia connectivity.Significantly, the theme of the Milan summit — “Responsible Partnership for Sustainable Growth and Security” — allowed for a discussion not only of ongoing political strains and tensions in Asia and in Europe’s eastern neighbourhood, but also of crucial non-traditional security threats linked to food, water, and energy security.In addition, the meeting brought back much of the informality that marked the first few ASEM summits by including a “retreat” session during which leaders — with only one aide in attendance — were able to have a free-flowing discussion on regional and international issues, including Ebola and the threat posed by the so-called Islamic State.Attendance was exceptionally high, with all key Asian and European leaders — apart from the new Indonesian president and the Indian and Pakistani prime ministers — taking part in the sessions.Even before they meet in Beijing, there was a quick handshake in Milan between estranged neighbours Chinese Prime Minister Li Keqiang and Japan’s Shinzo Abe. Russian President Vladimir Putin was in attendance. Also, the EU finally held a long-awaited first-ever summit with Asean leaders. Kazakhstan and Croatia joined ASEM, bringing the total number of ASEM participants to 53.Leaders agreed on an ambitious programme until 2016, the year when ASEM, under Mongolian chairmanship, will celebrate its 20th anniversary. Countries agreed to work in smaller groups or clusters on 16 “tangible cooperation areas” including disaster management, renewable energy, higher education, connectivity and information technology.The challenge is to keep up the momentum generated in Milan. The good news is that ASEM’s resilience has allowed it to survive many upheavals since its launch in Bangkok in 1996. Initial euphoria over the initiative was followed by a period of inertia and a degree of disinterest. Asians criticised European leaders and ministers for not turning up at important ASEM meetings.Europeans complained that the gatherings were turning into little more than photo ops. The current mood is positive as ASEM seeks a stronger focus on content. However, ASEM’s future hinges on whether governments are ready to pay as much attention to ASEM and devote as much time and energy to their partnership as they did in the early years. Closer engagement between Asian and European business leaders, civil society representatives and enhanced people-to-people contacts is also essential.In the future ASEM needs an even sharper focus on growth and jobs, combating extremism and tackling hard and soft security issues. Women in both Asia and Europe face many societal and economic challenges. Freedom of expression is under attack in both regions. Populist parties and nationalism are becoming a threat to diversity and societal peace in both regions.Finally, ASEM faces the uphill task of securing stronger public understanding, awareness and support for the Asia-Europe partnership. ASEM’s 20th anniversary in 2016 should set the Asia-Europe partnership on a new and more dynamic track — that could perhaps generate the kind of excitement that APEC does.