Mumbai :The free trade agreement (FTA) talk between India and Eurasian Economic Union is in its advance stage. The joint feasibility study has been accepted by India and Eurasian Economic Union, revealed Sunil Kumar, Joint Secretary, Department of Commerce, Ministry of Commerce and Industry.
Commenting about this comprehensive agreement which includes trade in goods, services and investment, Kumar said, “With Europe, FTA discussion is still on. But with Eurasian Economic Union which consists of countries like Russia, Belarus, Kazakhstan, Kyrgyzstan and Tajikistan, things are moving faster.”
Kumar told The Free Press Journal, “A joint feasibility study has been accepted by both sides. So, it (agreement) can get concluded in a year or so. But we are expecting formal negotiations to commence soon.”
Kumar, who was in the city to attend the press conference of CAP 2017, added, “At political level, all the countries are showing political will.” As of now, the trade between both parties is worth USD 10 billion. In 2015, India and Russia set a target of USD 30 billion by 2025. India’s export to that region stands at USD 2.5-3 billion. “In order to achieve that target, this FTA will be helpful. We are importing lot of things from there. There is no form of competition and what we import from there, we continue to import. If the duty reduction takes place, we will get things cheaper. Balance of trade is negative and there exports are more. We are going to gain,” Kumar added.
On the other hand with Latin America region, the India government has signed preferential trade agreement with Peru. “There are talks on for that region. I do not know much detail there,” Kumar added.
Talking further about new markets like Latin America, he said, “New growth will be driven by new markets.” However, he pointed out few challenges in the region. He highlighted that due to cash crunch in country like Venezuela, payments to Indian SMEs are done post 120 days. “Payment from some markets come post 120 days which impacts our small and medium exporters. It becomes a problem for them to wait. In fact there are certain countries that are problematic,” he added. He also added that this problem is not just with Latin American countries but some big players in Europe take 160 days to clear credits.