“The two sides have met and discussed initiating formal talks for the pact,” an official said, adding that in the light of this development, inputs have been sought from industry on barriers and products in which the country wants to achieve self-reliance.
New Delhi’s concerns stem from the fact that India’s exports to the union in April-January FY24 were $3.7 billion while imports were $51.7 billion due to crude oil imports from Russia. Moreover, the bloc has signed free trade pacts with China, Vietnam, Serbia and Iran, which could impact Indian industry’s competitive position in any of the EAEU markets.
As per the joint feasibility study report on India-EAEU, New Delhi’s export potential to the bloc is estimated at $14-24 billion.
“There are certain products with low-negotiation prospects where we have concerns on giving market access. Dairy and agricultural products are one such sticky agenda in many FTAs,” said an industry representative. Medicines, telephones, shrimp and prawn, auto components and steel products are India’s top exports to the EAEU whereas coal, petroleum, diamonds, fertiliser and metals are among the top imports. Russia is India’s top trading partner in the union.
India’s outbound shipments to the EAEU accounted for a mere 0.8% of the country’s total exports whereas imports from these countries accounted for a share of 4.8% of its global imports in 2022. The commerce and industry ministry has also asked industry the details on tariff and non-tariff barriers it faces in the bloc as well as those products where it hopes to expand in future and the relaxation to be sought from EAEU. “The EAEU’s major trade partner has been China and India needs to be careful while negotiating the rules of origin so that circumvention of cheap Chinese imports doesn’t take place,” said a Delhi-based trade expert. India has already inked a trade pact with the European Free Trade Association, which comprises Iceland, Liechtenstein, Norway and Switzerland.
