Brussels, 30/03/2009 (Agence Europe) - Despite the slowness of negotiations for a free trade zone (FTZ) between the EU and India, which were launched in May 2007, the European Parliament is now hoping these negotiations can be completed by the end of 2010. This is the message contained in the common resolution from the EPP-ED, ALDE and UEN, adopted by 326 votes in favour, 226 against, with 32 abstentions on Thursday 26 March in Strasbourg and based on the report of British Conservation, Sajad Karim.
In the first chapter on general matters, the European Parliament calls for a sectoral assessment of the FTZ benefits, despite the growth potential already known for trade and bilateral investments and which is estimated to be over €70.7bn by 2010 and €160.6bn by 2015. The resolution also contains a long chapter on the trade in services, the driving force of the Indian economy. Although trade is expected to be more than €246.8bn in 2015, Parliament underlines its currently “relative imbalance” with the EU only exporting 1.5% of services to India, while the latter exports 9.2% of services to the EU. According to the EP, the FTZ objective should be to speed up liberalisation in services in India, particularly telecoms, legal services and banking. Parliament believes, however, that services liberalisation should not impinge on the right to regulate services, particularly public services. In a chapter on investment, the EP called for the setting up of a one-stop information outlet for investors. Parliament regretted that India was not ready to include public procurement but did call on the Commission to negotiate efficient and transparent public procurement markets. In the area of intellectual property, the EP is urging the different parties to ensure that TRIPS does not prevent access to essential medicines whilst India develops its capacity to transform itself from a producer of generic products to an industry based on R&D. Trade and sustainable development: the EP underlines the importance of the FTZ guaranteeing respect for social and environmental standards. The EU and India are being urged to ensure that investment is not encouraged at the price of weakening legislation and standards on the environment, work, health and safety. The clauses on human rights and democracy must constitute an essential component in the FTZ, as well as guaranteeing that profits benefit the whole of Indian society, including the tribes and casts on the margins of society. Parliament is also appealing for a clause to guarantee that European companies using special economic zones are obliged to respect fundamental labour rights. Finally, Parliament is appealing for the question of child labour to be tackled and calls on India to ratify and implement basic ILO agreements. (E.H./trans/rh)