Kolkata, Apr 28 (UNI) The World Trade Organisation (WTO) is in the process of conducting negotiations between the European Union (EU) and India for a Free Trade Agreement (FTA) to improve bilateral trade relations, Ambassador and Head of the Delegation of the European Commission to India, Nepal and Bhutan Daniele Smadja said here today.
Speaking at an interactive session on EU-India Economic Partnership, organised by the Indian Chamber of Commerce (ICC), Ms Smadja said, ''The two-way trade in goods and services between India and the EU is as high as 68 billion Euros annually. However, the present volume of trade is much lesser than the actual potential that can be achieved. Therefore, the WTO, which has its headquarters at Geneva, is in the process of negotiating the FTA.'' She said with the signing of the FTA, India could benefit enormously from the bilateral trade relations with the EU - the largest public procurement market in the world - as it would improve transparency.
On the potential of India exporting IT and ITeS services to the EU, the Ambassador said the IT companies of India were welcome to invest in the EU member nations.
On the question of the weakening of the US Dollar and the progressive strengthening of the Euro, Ms Smadja said it was very difficult to predict or control the level of the Euro as the EU comprised 27 member nations, all of whom had varied economic conditions and priorities.
'' The functioning of the European Central Bank (ECB) is very different from that of the Federal Reserve Bank of the US. The main mandate of the ECB is to control the level of inflation,'' she said.
She informed that the EU had been quite involved in the electioneering process in Pakistan and Nepal. The Union had sent Observation Missions to both the countries to oversee the elections and also shared its inferences with India.
'' We have also sent similar Observation Missions for the first ever elections in Bhutan to help them validate the process. The exercise will also be taken up for the elections in Bangladesh, scheduled towards the end of this year. Besides, we are also closely monitoring the peace process in Sri Lanka,'' she elaborated.
The Union was also extending financial support to all the SAARC countries in the health, education and human rights sectors as well as working for the development of the communities outside the mainstream, Ms Smadja said, adding that 80 per cent of the development assistance were reaching their target through the respective governments while the rest was being provided directly to the NGOs.
The other important areas where the EU was working extensively were the food crisis, climate change and global warming.
ICC senior vice-president Sanjay Budhia informed that the EU-India trade had witnessed a sharp increase from 47 billion Euros (USD 73 billion) in 2006 to 55.6 billion Euros (USD 86 billion) in 2007.
'' However, there is a concern over India's growing trade deficit with the EU. The deficit rose to USD three billion in 2006-07 from USD 492 million in 2001-02. Consequently, there is a need to evolve a clear policy for comprehensive economic cooperation agreements with some developed countries in the EU,'' Mr Budhia said.
He opined that there was a significant scope of enhancing EU-India cooperation in sectors of strategic importance, including infrastructure, energy, financial and legal services, pharmaceuticals and automotives.
'' West Bengal, which is currently witnessing a steady process of industrial resurgence, can emerge as a preferred investment destination for EU countries because of several advantages, including low cost of operations, political stability, proximity to South-East Asian countries, proactive industry-friendly policies of the state government, comparative advantages in sectors like IT and ITeS, agro and food processing, chemicals and petrochemicals,'' he added.
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