India, Australia getting closer to a deal on FTA: Sitharaman

Commerce Minister says no more steps planned for checking cheap steel imports

Negotiations on the free trade agreement (FTA) between India and Australia are progressing substantially and the two countries are probably “close to a deal”, Commerce & Industry Minister Nirmala Sitharaman said on Monday.

Speaking at an event organized by industry body Confederation of Indian Industry (CII), Sitharaman said she had met the Australian trade envoy earlier in the day and hoped for quick progress on the matter.

The talks for a comprehensive FTA started in 2011 but differences, mainly on tariff reduction in certain product categories, have lengthened the process.

Australia is pushing for tariff reduction in dairy products, fresh fruit, pharmaceuticals and wines. India wants zero duty on automobile parts, textiles and fresh fruit.

India has also demanded greater access in the services sector. "We have made our offers. But renewed and refined or enhanced offers are awaited. In services also, we are negotiating for a better offer from Australia having given our own wish-list," Sitharaman told reporters.

Earlier, Finance Minister Arun Jaitley had said he expected substantial headway in negotiations for the agreement.

Several rounds of negotiations have been completed, besides removing non-tariff barriers. Bilateral trade was $13 billion in 2014-15, up from $12.1 billion in FY14.

On a related note, the minister said India is very keen to conclude the Bilateral Trade and Investment Agreement (BTIA) - the FTA between India and the European Union. She added that she will be writing to EU to "quickly" arrange a meeting between chief negotiators of both countries.

While a joint EU-India Agenda for Action 2020 has been adopted by both countries as a common roadmap for the India-EU Strategic Partnership in the next five years, not much headway has been made on BTIA.

The BTIA negotiations had remained deadlocked since May 2013 over growing differences regarding greater market access sought by both sides for merchandise exports. However, Commerce Ministry officials said the EU is seeking the lowering of tariffs on automobiles and wine products.

Issues related to facilitation of greater movement of professionals from one country to another, arising out of the Mode 4 provisions of the 1995 General Agreement on Trade in Services is another point of contention between the two sides. This also involves India's demands to be classified a data- safe country, which will help Indian information

Two-way merchandise trade between India and the EU stood at $98.5 billion in 2014-15.

Also, responding to whether the government was considering more steps to deal with cheaper steel imports from abroad, Sitharaman said no more steps are planned.

"If the steel ministry is looking into it, we will have to wait and hear from them," she said. In February, the government imposed MIP on 173 steel products ranging between $ 341 to $752 per tonne (nearly Rs 23,065.24-50,865.28) to give relief to domestic steel producers against cheap in-bound shipments.

The MIP will remain in place for six months only. The government has also imposed a safeguard duty on certain steel products.

Sitharaman also said the new guidelines for e-commerce will provide a level playing field to both online and offline stores by bringing in greater clarity. Stating that the market is free and the government does not believe in interfering in it, the minister pointed out the guidelines have also assured brick and mortar stores of fair competition.