Germany presses India to hike insurance equity cap

India is pressing Germany, the biggest economy in Europe, to provide a "strong political thrust" for inking of broad-based BITA

Germany today pressed India to hike the foreign equity cap in the insurance sector and reduce tariffs on import of automobiles as a prelude to the much- awaited India-EU Free Trade Agreement even as the two countries signed six pacts including one under which a German loan of Euro one billion(Rs 7,000 crore) will be provided for a green energy corridor in India.

After talks with Prime Minister Manmohan Singh, German Chancellor Angela Merkel said that India and the EU have not yet overcome "all the difficulties" in reaching an agreement to conclude the FTA.

India is pressing Germany, the biggest economy in Europe, to provide a "strong political thrust" for inking of broad-based Bilateral Investment and Trade Agreement (BITA) with the 27-nation European block.

Merkel, who jointly co-chaired the second round of Inter-Governmental Consultations (IGC) with Singh,  however, minced no words when she said that the increase in the insurance cap by India was "undeniably" an important issue apart from resolution of issues such as tariff rate quota on imports of German cars, Services and Intellectual Property Rights.

"We want progress in the signing of the EU-India free trade agreement. We are in a situation where it seems as if we can get there. We have not yet overcome all the difficulties," Merkel told reporters while appreciating Indian side to be "accommodating" in paving the way for inking of the pact.