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India-EU Summit to consider free trade pact on Friday

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Irate passengers at a closed Kingfisher Airlines counter, Mumbai airport - Source: AP

The proposed free trade pact, which has been hanging fire for quite some time, will figure prominently in the India-EU Summit on Friday when the two sides discuss ways to boost relations in commerce and other spheres.

Prime Minister Manmohan Singh will lead the Indian delegation while European Council President Herman Van Rompuy and European Commission President Jose Manuel Barroso will lead the EU team.

This is the first such Summit in India following the implementation of the Lisbon Treaty.

"The progress in the free trade agreement and the carbon tax issue are expected to figure in the summit besides discussions on ways to enhance two-way trade between India and EU," an official said.


The EU as a block of 27 countries is India's largest trading partner accounting for about 14 per cent of India’s foreign trade. The negotiations for Bilateral Investment and Trade Agreement (BTIA), underway since June 2007, are at present critically poised and there is a fair desire to conclude it at an early date, the official said.

The two sides are expected to unveil a political agreement on the pact during the Summit.     

The proposed pact seeks to liberalise trade in goods and services, besides investments.

The negotiations on BITA were to conclude in 2011 but differences on the extent of opening of the market came in the way.

Meanwhile, after meeting Commerce and Industry Minister Anand Sharma, European Union (EU) Trade Commissioner Karel De Gucht said: "Tomorrow, we will present our report".

The controversial European Union Emissions Trading Scheme that requires all airlines, including Indian, using airports in EU to pay a tax for their greenhouse gas emissions, the official said, will be raised by the Indian side strongly.     

India, Russia, the US, China and other countries will meet in Moscow later this month to decide on whether to take retaliatory measures against EU on its "unilateral" decision to impose carbon tax on air travel.

India's trade volume with EU stood at $91.3 billion during 2010-11.