India, EU conclude 11th round of FTA talks; to reach deal in two phases

India and the European Union (EU) have concluded the 11th round of negotiations for a proposed free trade agreement (FTA), agreeing to finalise the deal in two phases due to ongoing global trade uncertainty, PTI reported, citing an official.

"The 11th round of talks concluded on May 16," the official said.

The decision to pursue a phased approach comes amid a volatile global trade environment, influenced in part by tariff actions initiated by US President Donald Trump.

The second phase of the negotiations is expected to be wrapped up by the end of this year.

The discussions between the two sides focused on market access offers in goods, services, and investment.

The strategic push for the deal comes on the back of commitments by Prime Minister Narendra Modi and European Commission President Ursula von der Leyen to seal the agreement by the end of 2025.

India has previously adopted a similar two-phase strategy while negotiating trade pacts with Australia and is employing the same approach in talks with the United States.

Commerce Secretary Sunil Barthwal has emphasised the importance of addressing core trade issues in the first phase for an "early harvest".

"If some of the issues which may not be very core to the trade, maybe taking some more time, then it is better to focus on core trade issues. So, we say that first things first...We are also discussing with the EU what can be the early harvest of the first tranche, where we can do faster," Barthwal had said last month.

The India-EU negotiations cover 23 chapters, including Trade in Goods, Services, Investment, Technical Barriers to Trade, Rules of Origin, Customs and Trade Facilitation, Government Procurement, Dispute Settlement, Intellectual Property Rights, and Sustainable Development, among others.

India’s bilateral trade in goods with the EU stood at USD 137.41 billion in 2023-24, with exports at USD 75.92 billion and imports at USD 61.48 billion, making the EU India's largest trading partner for goods.

The bloc accounts for about 17% of India’s total exports and 9% of its imports.

The bilateral trade in services between the two economies was estimated at USD 51.45 billion in 2023.

Indian exports such as ready-made garments, pharmaceuticals, steel, petroleum products, and electrical machinery are expected to gain a competitive edge in the EU market once the agreement is finalised.

Apart from the FTA, the two sides are also negotiating an investment protection agreement and an agreement on geographical indications (GIs).

Earlier this month, on May 6, India and the UK announced the conclusion of their FTA negotiations.