New Delhi is in search of to deepen international partnerships after U.S. President Donald Trump doubled tariffs on Indian items to 50% final month over India's Russian oil purchases, hitting exports corresponding to textiles, leather-based and chemical compounds.
Negotiations, relaunched in 2022, have gained tempo since Trump's re-election. Brussels too, confronted with Trump's tariffs, has accelerated its push for commerce alliances, sealing offers with Mexico and the South American Mercosur international locations and stepping up talks with India, Indonesia and the United Arab Emirates.
A pact with the EU may additionally draw India nearer to the West, after unease over Prime Minister Narendra Modi's latest go to to China for a summit attended by Russian President Vladimir Putin and different leaders.
“Talks with the EU are progressing effectively,” an Indian authorities supply stated, citing Modi's name with European Fee President Ursula von der Leyen final week, when each leaders pledged to conclude a deal this yr.
To this point 11 of the 23 chapters underneath negotiations have been finalised, overlaying customs, digital commerce, mental property, competitors, subsidies, dispute settlement and anti-fraud measures, the supply stated. However sticking factors stay India has dominated out concessions on agriculture and dairy, citing farmers' livelihoods, whereas the EU is urgent for larger entry to India's marketplace for vehicles and alcoholic drinks.
Variations additionally persist on guidelines of origin, meals security requirements, labour and environmental obligations, and what Brussels views as restrictive Indian high quality management orders that act as non-tariff limitations, an EU official stated.
The sources spoke on situation of anonymity as the small print about commerce talks will not be public.
India's commerce ministry and the EU workplace in New Delhi didn't instantly reply to e-mail requests for feedback.
Russian oil purchases
Brussels can be urgent New Delhi over discounted Russian oil purchases, which EU officers say undermine sanctions in opposition to Moscow.
Whereas unlikely to dominate the discussions, the problem may solid a pall over the negotiations and lead to resistance within the European Parliament, which must approve any deal, EU officers stated.
European Agriculture Commissioner Christophe Hansen and EU commerce chief Maros Sefcovic can be in Delhi later this week for discussions with Indian counterparts.
In parallel, the EU's Political and Safety Committee, led by Chair Delphine Pronk and comprising ambassadors of all 27 states, will go to India from September 10-14 for conferences with officers, defence executives and suppose tanks.
One other contentious problem is the EU's carbon border tax, which can levy carbon-intensive imports corresponding to metal and aluminium from 2026.
Indian officers name it a disguised commerce barrier whereas Brussels insists it's central to its local weather coverage.
EU officers stated they had been prepared to supply flexibility in its implementation to handle the issues of small and medium-sized companies.
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