‘Several knotty issues in trade talks with EU’

Trade negotiations at the upcoming India-European Union summit have assumed significance as the euro region, caught in an economic maelstrom, looks for greater access to Indian markets. Rahul Khullar, commerce secretary, spoke to Neeraj Thakur on the government’s concerns in the parleys with India’s largest trading partner. Excerpts:

Thirteen rounds of negotiations so far, and every time, there is some glitch or the other. What are the major bottlenecks?
There is no bone of contention on any single issue. The trade deal is about lots of things. One segment deals with trade in goods, trade in services; then there are allied chapters that deal with sanitary and phytosanitary measures.

We also have some issues regarding government procurement of goods. For example, in goods negotiations, we are still trying to work out an agricultural package. 

Then there are issues related to intellectual property rights in which the EU is looking for geographical indications for its products, which is still being sorted out.

On goods, they are looking at sectors like auto, wines and spirits. The auto industry is important for Germany, whereas wine is important for the whole continent and spirit is important for the UK. There are lots of things which have not been settled, but I am sure we will be able to strike the right balance very soon.

You can’t clinch a deal because other ministries are also involved...
Well, I don’t want to blame my colleagues in other ministries. The EU wants Mode 3 access in sectors like legal services, accounting services and maritime services and the financial sector. The services markets are very protective and protected. For example, for five years, lawyers have been talking about opening the market for legal services, but there is a bunch of lawyers which is hell bent on preventing any market access. Now, the question you need to ask is, why should the corporate sector be denied the best of legal services? Similarly, there are difficulties on the side of accounting, and auditing sector because they always talk about the big five accounting firms.

So, for an outsider, India may look like a very protective market. It is not that the ministries concerned do not want to reform, but the problem is that the stakeholders in the services sector are not ready for a change, because that change will mean only the best will remain in business and the rest may have to pack their bags.

Our agriculture products face quality issues in EU...
We have discussed the issue with our government and we will come out with a solution for it.

Our demand has also been to allow easy movement of people...
There is a huge unemployment problem in the European countries and there is a huge political backlash to foreigners coming in and taking jobs. But things will work out if we offer them a good deal from our side.

Can you clinch the deal this time?
We had set a target of seven years for having barrier-free trade. We still have two years left. Trade negotiations do not happen overnight, it takes time.