The EU will not budge on its demand for steep cuts in import duties on cars and wines & spirits in the India-EU FTA talks notwithstanding the fact that both sides decided on working on a year-end deadline to conclude the talks, an EU official said.

“I would even go as far as saying that without a substantive commitments on cars, there will not be a trade agreement between the EU and India. And of course, our Indian colleagues and counterparts are duly aware of that. But it is up to them to respond to that, and that will be done within the four walls of the negotiating room,” the official said.

On FTA talks

Prime Minister Narendra Modi and EU President Ursula von der Leyen, decided on Friday to give instructions to officials to try and wrap up the FTA negotiations, going on for almost two decades, by the year-end.

India’s basic customs duty on cars is about 70-100 per cent while on wines and spirits it is up to 100 per cent.

“There is a very strong political commitment from the EU President as well as from the Indian Prime Minister to get this deal done this year and to do it in the backdrop of a changing geopolitical landscape,” the official said.

At the second meeting of the EU-India Trade and Technology Council, also on Friday, both sides noted that the work taking place in the working group on `trade, investment and resilient value chains complemented the ongoing negotiations on a FTA, an Investment Protection Agreement and a Geographical Indications Agreement which are proceeding on separate tracks.

Sticking points

The intricacies and sticking points of the India-EU FTA were also discussed in a meeting between Commerce & Industry Minister Piyush Goyal and EU Trade Commissioner Maroš Šefčovič. “Had a candid and insightful discussion with EU Trade Commissioner Maroš Šefčovič over breakfast today on the India-EU FTA and the progress of the Trade and Technology Council. Exciting times ahead as we work towards elevating our trade & investment ties to the next level as trusted partners,” Goyal posted on social media platform `X’ on Friday.

On whether the EU was ready to respect India’s sensitivities in agriculture, the EU official said   the bloc was fully focused on offensive interest in the field of agriculture while navigating the sensitivities. “I would not really say that agriculture is the most sensitive issue in negotiations. There are many sensitive issues, and as usual, the last mile tends to be that the hardest one to walk,” the official said.