Flagship Initiatives Being Promoted By the Government Of india create Interesting Room for Cooperation

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European Union (EU) is a powerful group of twenty eight European states and is one of the biggest engines of the world economy, along with the US and Japan. Europe is also the largest of India’s trading partner and the largest investor in Indian economy. Needless to say, European Union and India are highly important for each other. In a conversation with Anand Mishra and Rajesh Mehta, the Ambassador of the European Union to India, João Cravinho spoke in detail about the current status and the future direction of India-EU relations, and the various crucial ways in which the two can cooperate. Edited excerpts:
Dr. João Cravinho
Dr. João Cravinho , Ambassador of the European Union to India.

There is a feeling that India EU relations are floundering as the EU India summit has been delayed. How do you react to that?
EU and India have been strategic partners for more than a decade now and have very strong political and economic ties. We continue to be its biggest trade partner, and biggest source of investment and technology. There was a possibility that the summit might happen in April. Although, it couldn’t take place due to logistical challenges. I am confident that the EU-India summit will be able to take place by the end of this year.

What are the major area of potential cooperation between India and the EU?
In terms of economic cooperation, there is a lot we can do together. Let us not forget that our economies are complementary: India exports to the EU primarily raw material and finished products, while the EU exports to India mainly semi-finished products. Trade certainly has a lot of potential to grow further. Apart from that, flagship initiatives being promoted by the Government – Make in India, Digital India, Clean Ganga mission, Smart Cities etc. – create interesting room for cooperation. The EU has vast experience in dealing with challenges such as infrastructure, development of a manufacturing base, pollution, water treatment, renewable energy; and we are keen to share these expertise and experiences with India.

Recently we had counter-terrorism and cyber-security dialogues with India in Brussels. EU-India Counter Terrorism consultations covered bilateral co-operation in this field and the terrorist situation in West, Central and South Asia. The cyber security dialogue was again, an excellent opportunity for the EU and India to discuss challenges in cyber crime, internet governance, standards and regulation, capacity building and research & development from an international policy perspective.

Also, there are issues of global governance, with climate change in the forefront. We have the Paris conference (COP21) at the end of the year. India and EU both are major players in the global governance and if we can engage in constructive dialogue, we can have a considerably enhanced influence in global negotiations.

Where do you see the talks on EU India FTA going? What are the developments on that front?
The latest developments have been quite positive. The EU has clearly expressed strong interest in resuming talks after a pause of two years and we have received encouraging messages from the Government of India. Now it is time to get back to the negotiating table and discuss in a constructive way the relatively small differences that still exist. I say ‘relatively small’ because I compare them to the potential advantages of a Bilateral Trade and  Investment Agreement (BTIA). TheEU’s Trade Commissioner Cecilia  Malmstrom recently met with Minister Nirmala Sitharaman on the sidelines of an OECD meeting and both leaders agreed that the  negotiating teams should meet and address the outstanding issues as early as possible.

How do you think the two sides can cooperate on multilateral bodies such as WTO?
The EU has always been, and continues to be, a strong supporter of the WTO and we are happy that India also sees the WTO as  the  linchpin of the multilateral trading system. In this respect, the EU and India view the Bali agreement as a landmark success for the WTO.  In particular, we are very pleased  that late last year India unblocked the impasse at WTO by resolving its differences on the issues of public stock holding for food security, while WTO Members have taken the commitment to find a permanent solution. As regards trade facilitation, the EU and India have always been supportive and India, considering its current ambitious economic reform programme (make in India, ease of doing business etc.), will certainly benefit a lot from the implementation of a trade facilitation chapter. But important work in the WTO continues. The Bali package was only a first step.

The Doha round, which is geared specifically to the needs of the least developed countries, must go on and we do hope that a conclusion can be reached by the next WTO ministerial in Nairobi (in Dec. 2015). I am certain that the EU and India will work
intensely to reach a satisfactory conclusion.

india-eu-trade
India EU trade has stagnated of late

How do you see the trade and investment relation growing between India and the EU?
There is big room for improvement, and I have no doubt that it will happen. Today, the EU is India’s first commercial partner, with a bilateral trade fl ow of around US$ 100 billion; this fl ow is balanced,unlike the one with China, where India records a growing defi cit. The EU is also India’s foremost foreign investor. Trade between the two blocs has more than doubled in the last ten years, but it has stagnated in the last four. It is time to expand this further. The BTIA would allow both EU and India to tap into this huge potential.

How do you see EU contributing to the huge infrastructure requirement that India has?
EU companies have the know how, skills and knowledge to contribute substantially in sectors like telecommunications, ports, roads, power generation and distribution, transport, waste and water treatment, etc. The role ofEU institutions is to facilitate the involvement of these companies in the realisation of such big Indian projects. Of course, it is important that the Government  of India facilitates it by ensuring a business-friendly environment, with clear, enforceable and non-discriminatory laws and regulations.

How do you view the recent initiatives of the Narendra Modi government suchas Make-in-India, Swachh Bharat and Clean Ganga Initatives? How can EU help in these initiatives?
These are very important and forward looking initiatives for India. The Government is stillrolling out the details of those programmes and the EU is keen to participate. Make-in-India is a rightly ambitious programme and has the potential to create
growth and jobs on a large scale; but, in order for it to succeed, the government must ensure that India is well integrated in the global value chain which dominates manufacturing in today’s world. This is one more reason to conclude a BTIA, which would allow greater investments and exchanges between EUand India.

On our side, we are implementing several programmes to facilitate business in India, like the Capacity Building Initiative for Trade Development (CITD) and the European Business and Technology Centre (EBTC) which is active in sectors such as energy, environment, sustainable transport and biotechnology.

As mentioned above, we are also keen to co-operate with India’s authorities on Smart Cities (we already have an ongoing cooperation with the Municipality of Mumbai) and Clean Ganga. The EU companies have stateof- the-art technologies for infrastructure, urban development, clean and renewable energy etc. They can play a vital role in the success of these commendable initiatives.

A large number of Indian SMEs feel that there is a big market in the EU for their products and services. But they find it very hard to get suitable information and platform which can help them. Is there any mechanism through which you can address their concerns/ information requirements?
In the EU, exactly like in India, SMEs represent a big chunk of the economy and we appreciate their need for correct and timely
information. Understandably, their entry into a foreign market is more challenging than for bigger and richer companies. That is why we strive to make all the needed information available. For example, we have an online information portal, called “EU Export Helpdesk”, which is a one-stop-shop for information for exporters to the EU market on EU tariffs, technical regulations,
rules of origin, environmental requirements etc.

Skill development has been a major thrust for the EU in India. Could you please throw some light on how it is progressing?
Skill Development is one of the key areas for cooperation between the EU and India. Vocational training was included as a priority for the wide-ranging EU-India dialogue on education initiated in November 2008. To increase employment opportunities for young people, women, and poor families and disadvantaged communities, the EU has funded 9 projects covering 22 states in India and 250 BRGF (Backward Regions Grant Fund) districts where regional imbalances in development need to be redressed.

This set of skill development projects has helped youth from marginalized communities to overcome their vulnerability with better bargaining power and market-relevant skills. The & Employment) and MHRD (Ministry of Human Resource and Development). Sharing European expertise in this area, the project aims to develop and maintain a national qualification framework for India, and set up a labour market projects have also supported the development of state-level policy frameworks; the assessment of  demands for various skills; and the building of these skills in various sectors.

Additionally, the EU is working in partnership with the National Skills Development Agency to contribute to the implementation
of the Skill Development Policy, and increase the number of certifi ed skilled labour in various sectors of employment. The project is being coordinated with the MoLE (Ministry of Labour & Employment) and MHRD (Ministry of Human Resource and
Development). Sharing European expertise in this area, the project aims to develop and maintain a national qualification framework for India, and set up a labour market information system.