Trade deal between India and EU
The increasing trade conflict between America and the European Union (EU) has intensified the turmoil in global trade equations. Following US President Donald Trump’s tariff threats regarding Greenland, the EU has stopped the approval process of the trade deal with America. Amidst these developments, activities regarding the India-EU Free Trade Agreement (FTA) have intensified, due to which India seems to be emerging as a reliable and stable trade partner.
The US indicated that additional tariffs of 10 to 25 percent could be imposed on European countries that oppose the US stance on Greenland. The EU called this a direct violation of the terms of the agreement. The EU says that under the trade agreement signed in July, the maximum limit of tariff on most European products is fixed at 15 percent, in such a situation, threatening tariffs by creating political pressure is not acceptable.
EU’s tough message: deal means deal
The Trade Committee of the European Parliament has made it clear that unless the threat of tariffs is completely withdrawn, it is not possible to move forward on a trade deal with the US. The statement of European Commission President Ursula von der Leyen is the essence of this entire controversy. He said that a deal is a deal. When friends shake hands, it should mean something. EU leaders allege that using tariffs as a political weapon is an attack on Europe’s economic and territorial sovereignty.
India will get benefit here
This tension in US-EU relations has come to the fore at a time when negotiations regarding a free trade agreement between India and EU are in the decisive stage. The visit of the top EU leadership to India at the end of January is considered very important in this background. It will not be limited to trade only, but will also set a common roadmap towards investment, supply chain, security partnership and strengthening the global rules-based order. According to experts, the EU is now looking for a partner that does not threaten tariffs, does not link sovereignty issues to trade and relies on rules-based and long-term partnerships. On this criterion, India emerges as a natural choice for the EU.
fta
India-EU FTA may get a push
The proposed FTA between India and EU is not just a trade agreement but a geo-economic partnership. This will give the EU a stable, democratic and big market in Asia. India can get better access to the European market in IT, pharma, textile, auto and service sectors. Both sides will strengthen the strategy to reduce dependence on China.
India’s biggest strength is no pressure, no surprise policy.
While America is accused of using tariffs as a pressure tactic, India has the image of a partner that finds solutions through dialogue. Respects sovereignty. Tries to keep trade separate from geo-politics.
This is the reason why India is being seen as a safe trade partner in the current global instability. The US-EU trade conflict arising out of the Greenland dispute is not just a fight between two parties, but it is a sign of rebalancing of the global trade system. In this changing scenario, India-EU FTA is gaining new strategic importance. If a consensus is reached in the upcoming visits and meetings, this agreement can give India a strong position not only economically but also in global trade politics.
Also read- Trump came on backfoot before India-EU deal, removed tariffs from many European countries!