India, Germany agree on concluding India-European Union Free Trade Agreement this year

BERLIN: India and Germany today set a target of concluding the long-awaited India-EU Free Trade Agreement this year notwithstanding a number of unresolved issues and BJP's demand for Parliamentary scrutiny this "highly controversial" move.

Prime Minister Manmohan Singh and German Chancellor Angela Merkel in a joint statement here underlined "their strong commitment to a successful outcome to the EU-India negotiations for a broad-based, ambitious and balanced Free Trade Agreement that will generate jobs and growth in both countries and their hope for final agreement in 2013."

The statement was issued at the conclusion of Singh's 3- day visit during which he pressed Germany, Europe's biggest economy, to provide a "strong political thrust" for inking of a broad-based Bilateral Investment and Trade Agreement (BITA) with the 27-nation European block.

The hope for concluding the FTA this year was voiced despite Merkel having candidly advocated yesterday that the two sides are yet to overcome "all the difficulties", as she pressed for an increase in the foreign equity cap in India's insurance sector and reduction in tariffs on import of automobiles from Europe.

Even as Singh was discussing FTA with Merkel, back home, the BJP took exception to his decision to engage in the final phase of negotiations for a "highly controversial" agreement without taking into account the opposition by experts and stakeholders.

The BJP expressed apprehension that the FTA would lead to the flooding of the Indian market with dairy, poultry, sugar, wheat, confectionery, oil seeds, fisheries and plantation products from the EU. Such an agreement would "directly compromise India's agricultural sovereignty and its food security," BJP leader Murli Manohar Joshi, said in demanding parliamentary scrutiny.

The joint statement covered a wide rage of subjects including defence collaboration and cooperation in climate change, science and technology and education.