Stress on substance over deadlines in India-EU FTA talks: EU trade commissioner Valdis Dombrovskis

Amidst the G20 Trade Ministers' meeting in India, EU's Trade Commissioner Valdis Dombrovskis emphasises a pragmatic approach in the ongoing India-EU Free Trade Agreement negotiations.

Speaking to WION's Sidhant Sibal, he said, "As we are seeing in the EU, it's substance over deadlines. So we are willing to engage intensively and continue to work... but at the end of the day, we need to get the substance right."

The commissioner, who is also the EU’s executive vice president, outlined the comprehensive nature of the negotiations, emphasising the EU's intention to craft a thorough agreement. "From the EU, we're aiming for a deep and comprehensive free trade agreement, which covers not only traditional tariff questions but also other questions including on sustainable development," he explained.

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Dombrovskis also advocated for the overhaul of the World Trade Organization (WTO) to match contemporary challenges. He highlighted the need to address novel issues arising from China's economic model, such as industrial subsidies and state-owned enterprise roles.

Here's the full interview:

WION: You are coming from Jaipur where the G20 trade ministers met, what kind of conversations took place, what is your assessment?

Valdis Dombrovskis: First of all, I would like to congratulate India on a very successful G20 trade ministers' meeting. So, indeed we had a very good trade ministers meeting. But I'm hearing this also from other ministerial meetings... about the organisation of meetings and indeed also reaching substantial agreements. So as regards our G20 trade ministerial meetings over a number of topics we covered including insurance, resilience of supply chains in a current more conflictual geopolitical context, discussing digital tools to facilitate trade, participation, and trade related to small and medium-sized enterprises. And we're making progress across all sectors.

WION: Sir, any update on the India-EU FTA? This is something that has been part of the conversation as one of the key things when it comes to the EU-India relationship.

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Valdis Dombrovskis: Indeed, I'm using this visit also to have bilateral discussions including on the progress we're making on the free trade agreement, and investment protection agreement..to achieve agreement as soon as possible. There is still a lot of ground to cover. Also, in terms of the scope of the agreement, because, from the EU, we're aiming for a deep and comprehensive free trade agreement, which covers not only traditional tariff questions but also other questions including sustainable development to avoid a situation where trade is causing harm to the environment or leads to lower labor standards. So we'll need to discuss how to properly address all those topics.

WION: Any deadline when it comes to FTA talks? I know when it comes to FTA talks, these aren't easy conversations. So any deadline you're looking at?

Valdis Dombrovskis: As we are seeing in the EU, it's substance over deadlines. So we are willing to engage intensively and continue to work.. but at the end of the day, we need to get the substance right.

WION: So India has been calling for reforms of the World Trade Organization. What is your take? On the reforms of the body?

Valdis Dombrovskis: Well, indeed, that's very much also the EU's view. This was also one of the topics we discussed at G20. And I think the G20 can be an important player in this regard in preparation for the WTO ministerial meeting and it is something that was being agreed also among broader WTO membership in the last ministerial conference that we need to work on this WTO reform. We need to bring WTO into the 21st century, with ways to address climate change, with ways to function in a digital economy, and also to address new challenges stemming from the socio-economic model of China like questions on industrial subsidies and transparency of industrial subsidies, the role of state-owned enterprises and property rights. And when we discuss WTO, another important element for WTO reform is the restoration of the functioning of the dispute settlement system which we.. as we know currently... is not working because the appellate body is blocked.

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WION: Movement of people from India to EU especially skilled migration, what kind of conversation has been happening? Are you looking at a mobility pact with India? Several EU countries have signed a pact... eager to sign. For example, Italy.

Valdis Dombrovskis: It must be said this is not an area that I'm covering in the European Commission. As regards our free trade agreement negotiations, they are covering some specific aspects of mobility like the mobility of professionals in the provision of services. So these discussions, we are obviously going to have in the context of our negotiations.

WION: So the import of refined oil products from India to the European Union, what sort of policy you have, because there have been comments coming from the EU especially the refined products, which are made from Russian crude oil..

Valdis Dombrovskis: Well, it's a new phenomenon and indeed we are currently assessing it. I'd say it's a cause of concern because we have introduced sanctions against Russia and the largest revenue source for the Russian budget is oil and oil products export. So with the EU oil embargo, with G7 plus price cap, we aim to reduce Russia's oil revenue. We know that Russia is actively seeking new markets. But now when we see a situation where many refined products are arriving into the EU market, which are made from Russian oil, that actually defeats the purpose of why those sanctions were put in place originally, so we're currently assessing what can be responsible.

WION: And have you raised the matter with the Indian side ever? Do you plan to raise? Is it part of the conversation, not in the context of your conversation which perhaps is happening, but otherwise, as well?

Valdis Dombrovskis: Well, indeed, obviously, we're raising it with our Indian counterparts. And I would also say the broader question of avoidance of sanctions and conventions by Russia is something we are in discussions with quite a number of countries.

WION: Have you raised with your counterpart?

Valdis Dombrovskis: Well, I have been raising this. This is not part of our FTA negotiation but it's something we are obviously flagging. It's a topic we are currently assessing.

WION: You will be holding the EU-India High-Level Dialogue on Trade and Investment with Indian trade minister Piyush Goyal, what will be discussed?

Valdis Dombrovskis: Number of areas which we need to cover. Obviously, we'll take stock of the progress of our FTA negotiations, but we are also discussing the state of play over our existing trade and investment relations. Trade irritants, what can be done to remove them, what can be done to facilitate trade, also in a current context, before we have an FTA.

WION: And what irritants can you talk about?

Valdis Dombrovskis: Well, I think there are a number of topics that are well-known from both sides, which we need to discuss. Maybe I will not go into detail. I will be raising it directly with my counterparts. I will say, that's a fact when you have intensive trade relations between countries, regions inevitably some issues which are emerging. So what is important is not the issues but there is a willingness to resolve those issues from both sides and we try to do so.

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