An end-of-year deadline for a free trade deal between India and the European Union is deemed unrealistic, according to Hervé Delphin, the European Union’s Ambassador to India. Delphin emphasized the necessity for a level playing field for European businesses, deepening his concerns about India’s regulatory uncertainty potentially influencing EU investments.
Delphin clarified that negotiating a free trade agreement (FTA) with the EU is far more intricate than any other similar agreement India has had with other partners. Being the largest market globally, access to the EU market comes at a high price and demands negotiations based on reciprocal arrangements and transparent mechanisms that ensure fairness. Delphin acknowledged the ongoing pace of negotiations and the political momentum supporting the agreement, further expressing the eagerness of both business communities to establish the FTA.
Regarding the timeline for completing the FTA, Delphin dismissed the notion of completing it by year-end, believing it to be an unattainable target given the complexity of the negotiations. Instead, he emphasized the importance of reaching a state-of-the-art, modern, and comprehensive FTA, even if it requires more time.
When questioned about a potential early harvest deal, Delphin noted that it would introduce a different dynamic, highlighting that it is not the EU’s preferred approach based on their records.
Delphin also addressed the concerns surrounding the EU’s Carbon Border Adjustment Mechanism (CBAM) in India. He refuted the notion that the CBAM is a protectionist instrument, stating that it aims to address carbon leakage in sectors where trade with Europe could create an uneven playing field for European companies. He emphasized that the CBAM aligns with the global commitment to reduce carbon emissions.
In conclusion, Delphin advocated for a comprehensive FTA that creates a level playing field, acknowledging the challenges and emphasizing the need for thorough negotiations rather than rushing to meet arbitrary deadlines. He also clarified the purpose of the CBAM and its contribution to global climate commitments.
