EU for Duty Cuts in Auto Sector in FTA with India

The government on August 3, 2011 said the European Union (EU) had requested India to cut import duties in several sectors, including automobile, in the proposed comprehensive market opening pact.

"The negotiations are ongoing. Requests have been made on a variety of sectors, including automobiles. Positions taken evolve from stakeholders consultations and domestic sensitivities," Minister of State for Commerce and industry Jyotiraditya Scindia said in a written reply to Rajya Sabha.

India is negotiating a Broad Based Trade and Investment Agreement (BTIA) with the 27-nation bloc since June 2007.

The pact with EU, which is India's biggest trading partner, would liberalise commerce in goods, services and investment. So far, 13 rounds of negotiations have been held.

The areas covered under the negotiations include trade in goods, services, investment; technical barriers to trade; customs cooperation; trade facilitation and intellectual property rights, Scindia said.

While nothing has been finalised, it is understood that the EU wants the import duty on luxury cars with minimum engine capacity of up to 1,500 cc to be reduced to 30 per cent from the existing 60 per cent.

The two sides, which registered trade of $75 billion in 2009-10, expect to conclude the negotiations by the end of 2011.

India recently implemented a comprehensive free trade pact with Japan and Malaysia.