India, Eurasian Economic Union to hold talks on trade pact

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Economic Times | 29 Janaury 2018

India, Eurasian Economic Union to hold talks on trade pact

By Kirtika Suneja

The government has worked out the details of a possible free trade agreement with the five nation Eurasian Economic Union (EaEU), which is expected to give a big boost to the country’s Eurasia policy.

A person close to the development told ET that a preparatory technical meeting between Indian and EaEU officials on the trade pact will take place on January 30-31 to lay the foundation for the trade talks. "This is a technical meeting to get things going for a trade agreement," this person said requesting anonymity.

The EaEU includes Russia, Belarus, Kazakhstan, Armenia and Kyrgyzstan. A joint feasibility study for the agreement, officially known as a Comprehensive Economic Partnership Agreement, has suggested that it cover trade in goods, services and investment to overcome three major obstacles in expanding economic ties with the union- lack of a formal trade and economic partnership, inadequate trade architecture and connectivity bottlenecks.

"The meeting is an important precursor because India’s interaction with these countries is limited," the person added.

Delhi can push for easier services trade with the five-nation bloc. "In services, there is the linguistics aspect also. Russian language will be a challenge even for IT companies. Non-tariff barriers will need to be discussed," said a Delhi based trade expert.

India and Russia have historically been strong trading partners. Total trade between the two countries posted an impressive growth of 22% to $7.4 billion in 2016-17. The two have now set a target to raise it to $30 billion by 2025, increasing the mutual investments from $10 billion to $15 billion by then. To address the connectivity issue, India is already negotiating the International North-South Transport Corridor Project (INSTC) with Russia to promote bilateral trade.`

The project proposes greater movement across Nhava Sheva in Mumbai through Bandar Abbas in Iran to Astrakhan in Russia and Baku in Azerbaijan.

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source: Economic Times