India-EU Free Trade Deal Likely by December, Says FM Sitharaman

On the day India and the UK agreed on a free trade pact, Finance Minister (FM) Nirmala Sitharaman stated New Delhi could complete a free-trade agreement (FTA) with the European Union by December this year as they were on just "one or two items" where both sides were fixated.

She was speaking at the 'ADB Governors Seminar: Cross Border Collaboration for Future Resilience' in Milan, Italy. She stated that except for one or two items on which both sides were fixated there was, largely, an agreement that could be through. “The European Union is top of our priority because of the traditional links which we have with the EU… If negotiations go forward in that spirit, the December (deadline) is not impossible to achieve,” the minister said.

The FM emphasized that the principle of free trade was efficiency, and it could not go against the acceptable principles of free trade.

She added that the global fragmentation as well as how the US's Tariffs announcement in April has played out has increased uncertainties, alongside global institutions not carrying the heft they were carrying before.

“Supply chains cannot be from one big market. Concentration risks have played out substantially,” she said, while stating that economically sensible measures post globalisation has caused great disruptions causing hardships for the common people.

While stressing that there was no going back on globalisation, she said, “Countries today have realised that there should be at least some level of their own resources being used for meeting their demands, i.e., self-reliance. It’s not a policy which is inward-looking, it’s progressive.”

In terms of linking India to global supply chains, Sitharaman said India has taken a long term view in building its supply chains based on its strategic strengths and capabilities. The finance minister said India wants to strengthen itself based on the assets it had, whether that be human capital or technology and sectors it can further build on.