European Commission President Ursula Vaughan and PM Narendra Modi.
Amidst increasing uncertainty in the world, the European Union (EU) and India are coming closer to each other. There may soon be a Free Trade Agreement (FTA) between EU and India. This is being considered a very big and historic deal for both the parties. European Commission President Ursula von der Leyen said in Davos that the EU and India are very close to a historic trade deal.
What is FTA?
FTA means Free Trade Agreement. This means that both countries/groups reduce taxes and barriers on each other’s goods, which increases trade.
Why is this deal special?
If EU-India FTA is reached, it will be one of the largest trade partnerships in the world. This will connect a market of about 2 billion people and there will be huge benefits in business.
EU team will come to India
Top EU leaders will visit India between 25 and 27 January. During this time, the 16th EU-India summit will be held, where this deal is expected to be finalized. The special thing is that the EU delegation will participate as the chief guest in India’s 77th Republic Day celebrations.
What things are still pending?
However, some issues are still not fully resolved, such as-
- Trade in agricultural products (agricultural goods)
- EU’s strict rules and carbon tax (CBAM)
- Intellectual property rights i.e. rules related to patents and technology
Both sides will have to take a decision at the political level to reach an agreement on these issues.
Talk not only on trade but also on security
EU and India now want to work together not only on trade but also on issues like maritime security, cooperation against terrorism, cyber security, defense partnership. EU wants India to become a big partner in its supply chain and defense manufacturing.
Visa and movement of people can also become easier. It is also expected in this summit that it can become easier for students, researchers, skilled professionals and seasonal workers to go to Europe.
final seal on the deal
This partnership between EU and India can prove to be very important for trade, defence, security and global stability in the future. Now the eyes are on the summit to be held at the end of January, where this big deal can be finalized.