India
FREE TRADE AGREEMENT WITH EU COULD GO WRONG
INDIA MUST FIND WAYS TO CLIP TRADE DEFICIT FIRST
2015-07-29 13:10
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Why is the BJP-led NDA government pursuing so keenly an unfinished Sonia Gandhi-Manmohan Singh agenda to have a free trade agreement (FTA) with the European Union (EU), which has been trying to have a free access into India’s burgeoning consumer market since 2007? India stands to gain little from such an arrangement. With its limited and mostly low-cost, low-technology small-value-added export basket, India can at best make only a tiny inroad into the EU market known for its preference to high quality products at competitive prices. On the contrary, EU, a hub of global high-technology products from automobile, transport and power equipment to wine and hi-fashion, can flood the Indian market with its world class wares and unsettle the current trade balance between the two markets.