Author: Manoj Kumar and Kanjyik Ghosh
Feb 27 (Reuters) – The European Union and India plan to grant each other most-favored-nation status after a trade deal comes into effect, banning them from offering better tariff terms to other partners for five years, a draft text released on Friday showed.
India and the European Union struck a long-delayed deal last month to cut tariffs on most goods and boost two-way trade amid rising global trade tensions elsewhere.
The EU said the deal, which could take effect within a year of legislative approval, is expected to double EU exports to India by 2032 by eliminating or reducing tariffs on 96.6% of trade goods by value and will save European companies 4 billion euros ($4.7 billion) in tariffs.
India and the EU said agriculture-related products such as soybeans, beef, sugar, rice and dairy products have been excluded from the scope of the trade deal.
A draft text released by India’s trade ministry shows that the two sides have agreed to lock in commitments not to impose new import and export restrictions beyond World Trade Organization rules and to deepen digital trade cooperation under the proposed free trade agreement.
To ease trade flows, New Delhi and Brussels will align food safety and plant health measures with WTO standards and streamline certification and audit procedures.
The text also envisages enhanced customs cooperation and faster clearance of goods, with commitments that will be binding upon approval.
The two sides will begin exchanging annual import data one year after the agreement enters into force to monitor the implementation and use of tariff preferences. They also agreed to ensure non-discriminatory and accessible appeals procedures for customs decisions affecting imports, exports or goods in transit.
When it comes to digital trade, India and the EU are committed to curbing unreasonable barriers and promoting an open and secure online environment.
The draft recognizes privacy as a fundamental right, while retaining both parties’ powers to regulate personal data protection and cross-border transfers.
It also promotes paperless trade and legal recognition of electronic contracts, signatures and authentications.
In addition, the draft shows that the EU will mobilize funds and investments to support India’s efforts to reduce greenhouse gas emissions under the proposed agreement.
(1 USD = 0.8461 Euro)
(Reporting by Manoj Kumar in New Delhi and Kanjyik Ghosh in Barcelona; Editing by Kevin Liffey and Hugh Lawson)
