India is in active talks with the United States on a free trade deal and will kick start discussions with Canada on a Comprehensive Economic Partnership Agreement (CEPA) next week, commerce minister Piyush Goyal said on November 28.
While India agreed to kick off negotiations for a “high-ambition” CEPA when Prime Minister Narendra Modi and his Canadian counterpart Mark Carney met November 23 on the sidelines of the G20 Leaders’ Summit in Johannesburg, New Delhi is also moving closer to finalising the first tranche of a broader pact with the United States.
Most Indian goods face a 50 percent tariff in the US since August 27.
Speaking at an event in New Delhi, Goyal said India is in talks with 14 countries or blocs for free trade agreements (FTAs). These include the European Union, the Eurasian Economic Union, Israel, the Gulf Cooperation Council, New Zealand, and Australia (for a second stage of the existing trade deal). New Delhi is also reviewing its pact with ASEAN to bring more balance.
FTA talks with the EU have entered the final phase, with a goal to conclude the agreement by the end of the year. Both sides have narrowed differences on key issues, especially following a visit by an EU negotiating team to New Delhi from November 3 to 7.
South Africa and the broader southern African region, as well as Mercosur nations led by Brazil, have also expressed interest in pursuing trade negotiations with India, the minister said.
"We probably could have concluded our FTAs with the UK, EU and EFTA nations 25 years ago, but we were fixated on protecting the auto industry and wines and spirits," Goyal said. "In reality, we were only protecting a mind-set that wasn’t futuristic, as competition brings greater efficiency and more choice for the consumer."
The EU is likely pushing for lower tariffs on key exports such as whiskey, wine, and cars for an FTA with India.
India also slashed duties on cars and spirits in its trade deal with the UK, which was signed in June.
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