India, EU close to sealing trade deal before Jan 26, but carbon tax a hurdle

NEW DELHI: India and the European Union are “very close” to finalising a trade deal with negotiators from the two sides working hard to bridge the gaps before the leaders from the two sides meet here around Republic Day, commerce secretary Rajesh Agrawal said Thursday.

“We have closed 20 out of 24 chapters completely. There are a few issues on which negotiations are on. We are virtually engaged and we are trying to see if we can meet the timeline before our leaders meet,” Agrawal told reporters, without elaborating further. The 27-nation trading bloc’s carbon tax is one of the contentious issues which is yet to be resolved.




If all goes well, the two sides are hoping to announce the conclusion of talks at the India-EU Summit on Jan 27, although the agreement will be signed later. “That will be a good occasion (to announce). We are making the right endeavour,” the commerce secretary said.

While there has been progress in talks with EU, Agrawal said that the bilateral trade deal with the US will be announced when both sides are ready. He said the two countries have been engaged, with commerce and industry minister Piyush Goyal holding talks with USTR Jamieson Greer late last month, while officials have been discussing the pending issues virtually.

“It’s very near, but we cannot put a deadline because that will happen... when both sides are ready and they feel that this is the right time to announce,” he said.

India and the US have been engaged in talks since last March after PM Narendra Modi and US President Donald Trump announced that the bilateral trade deal will be finalised by last Fall (Sept-Oct). Recently, US commerce secretary Howard Lutnick, however, said that the deal could not be finalised as PM did not call Trump, unlike leaders from other countries – a claim that was rejected as “not accurate” by govt.

Asked about the possibility of the bilateral trade agreement with the US not working out, Agrawal said: “We get into all negotiations with a very positive and optimistic mindset... we are engaged with the US. Both sides are engaged. So, both sides feel that this can be done.”