Some Critical Issues in the EU–India Free Trade Agreement Negotiations

• DOI: http://doi.org/10.1111/eulj.12109
• Date: 01 November 2014
• Published date: 01 November 2014

Some Critical Issues in the EU–India Free

Trade Agreement Negotiations

Jan Wouters, Idesbald Goddeeris, Bregt Natens and

Filip Ciortuz*

Abstract: The free trade agreement currently negotiated between the EU and India is

due to be the f‌irst of a new generation of free trade agreements between the EU and an

emerging economy. This article addresses a number of critical issues in the negotiations

and the EU’s response to them. These issues include European labour standards and

General Agreement on Trade in Services Mode 4 liberalisation; Indian generic medicine

production and EU interests in patent protection; EU agricultural subsidies and their

impact on the Indian dairy sector; the human rights and democracy dimension of the

EU’s foreign policy; and transparency issues of the negotiation process.

I Introduction

The EU has invested considerable resources to conduct and f‌inalise free trade agree-

ment (FTA) negotiations with numerous trade partners, most recently Singapore,

Moldova, Georgia and Armenia. However, its negotiations with large trading part-

ners such as India, the focus of this article, have been going on for a considerable

amount of time and demonstrate that concluding an FTA between large economic

powers is not an easy task.1India, too, has been actively—and rather successfully—

concluding FTAs, inter alia, with major economic powers such as ASEAN, Japan,

Korea and Mercosur.2Its foreign trade policy is characterised by responsiveness to

domestic policy making by politicians and technocrats rather than to international

forces. The country has acquired the reputation of hard-line negotiator with a defen-

sive strategy, not easily giving in to trading partner demands.3Additionally, India has

* Jan Wouters is Jean Monnet Chair ad personam, Full Professor of International Law and International

Organizations and Director, Leuven Centre for Global Governance Studies/Institute for International

Law, KU Leuven; Idesbald Goddeeris is Associate Professor of History at KU Leuven, where he

teaches inter alia courses on modern and contemporary India; Bregt Natens is Research Fellow, Leuven

Centre for Global Governance Studies/Institute for International Law, KU Leuven; Filip Ciortuz

graduated in European Studies in 2012 at KU Leuven with a thesis on the EU–India FTA.

1For example, EU Negotiations with Mercosur are based on the 1999 Negotiation Directives. Negotia-

tions with ASEAN were ongoing since 2007 but have been stopped; the EU is now focusing on bilateral

agreements with separate ASEAN members.

2See for an overview of both concluded FTAs and negotiations: Government of India, ‘Trade Agree-

ments’, http://business.gov.in/trade/trade_agreements.php (accessed 5 August 2014).

3P. Ramdasi, ‘An Overview of India’s Trade Strategy’, (2010) Idées pour le Débat de l’Institut Du

Développement Durable et des Relations Internationales/Sciences Po Paris 1, 35.

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European Law Journal, Vol. 20, No. 6, November 2014, pp. 848–869.

© 2014 John Wiley & Sons Ltd., 9600 Garsington Road, Oxford, OX4 2DQ, UK

and 350 Main Street, Malden, MA 02148, USA

questioned the strategic power of the EU in Asia.4Moreover, the EU’s political power

may have been constrained by increased global multi-polarity, a growing economic

nationalism, the f‌inancial and Eurozone crises and the ‘judicialisation’ of world

trade.5It seemed clear from the outset that the FTA negotiations between the EU and

India would not be a proverbial ‘walk in the park’.

This article addresses a number of critical issues in EU–India negotiations.

We begin by describing the general relationship between the EU and India and the

economic potential of the FTA in order to parse out what is at stake. Afterwards, we

address some of the diff‌iculties by highlighting the following contentious issues raised

by civil society stakeholders: (1) European labour standards and World Trade Organ-

ization’s (WTO) General Agreement on Trade in Services (GATS) Mode 4 liberali-

sation; (2) Indian generic medicine production and EU interests in patent protection;

(3) EU agricultural subsidies and their impact on the Indian dairy sector; (4) the

human rights and democracy dimension of the EU’s foreign policy; and (5) transpar-

ency issues of the negotiation process.

II General EU–India Relations

Considered ‘natural allies in a wide range of global issues’ by both parties,6diplomatic

relations between India and the EU were established in the early 1960s. Since the

1990s, cooperation between the two increased and their relationship was institution-

alised.7In 2004, the European Commission (Commission) proposed the establishment

of ‘an ambitious strategic partnership between the EU and India’.8The EU identi-

f‌ied India as a ‘strategic partner’, as it increasingly strengthened its position on the

international scene, was booming economically and encompasses a vast territory and

population.9These ‘strategic partnerships’ have become one of the key features of

European foreign policy as a way for the EU to assert itself while allowing emerging

powers like India to build up their status as global players. In the context of this

partnership, the EU seeks to deepen economic ties with India through bilateral

dialogue on intellectual property rights, trade defence instruments, technical barriers

to trade, sanitary and phytosanitary measures and customs cooperation.10 The

4D. Allen, ‘The EU and India: Strategic Partners but Not a Strategic Partnership’, in T. Christiansen,

E. Kirchner and P. Murray (eds.), The Palgrave Handbook of EU-Asia Relations (Palgrave

Macmillan, 2013), at 572; G. Sachdeva, ‘India–EU Economic Ties: Strengthening the Core of the

Strategic Partnership’, in L. Peral and V. Sakhuja (eds.), The EU-India Partnership: Time to Go

Strategic? (EUISS and ICWA, 2012), at 54.

5S. McGuire and J. Lindeque, ‘The Diminishing Returns to Trade Policy in the European Union’, (2010)

48 Journal of Common Market Studies 1329, 1329–1333.

6High Level Trade Group, ‘Report of the EU-India High Level Trade Group to the EU-India Summit’,

(2006) http://trade.ec.europa.eu/doclib/docs/2006/september/tradoc_130306.pdf, (accessed 5 August

2014) 2.

7I. Goddeeris, ‘EU-India Relations’, (2011) Leuven Centre for Global Governance Studies Policy Brief

16, 5.

8European Commission, ‘Commission Proposes a New Strategic Partnership between the EU and India’,

(2004) Press Release IP/04/759, http://europa.eu/rapid/pressReleasesAction.do?reference=IP/04/759&

format=HTML&aged=0&lg=da&guiLanguage=en. (accessed 5 August 2014).

9European Commission, ‘An EU–India Strategic Partnership’, (2004) Communication from the Com-

mission to the Council, the European Parliament and the European Economic and Social Committee

COM (2004) 430. See, for a critical analysis of the strategic partnership, D. Allen, ‘The EU and India

...’,n4supra, 571–586.

10 High Level Trade Group, ‘Report of the EU-India High Level Trade Group . . .’, n 6 supra, 7–8.

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