Although India and the European Union have been engaged in negotiations on a free trade agreement since June 2007, a deal doesn’t seems likely to be coming anytime soon. What’s stopping them from arriving at a consensus?
Further, EU has been quite insistent on its requirement for ‘TRIPS-plus’ intellectual property protection which exceeds the standards imposed by the WTO’s agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS). If this happens, India’s pharmaceutical sector – which is known for providing cheap life saving drugs to many countries of the third world – will almost crumble. The reports that have come out till now suggest that EU is pressurising the Indian government to extend the period of patents beyond 20 years; data exclusivity which delays the entry of a generic medicine in a market by 10-15 years even after the expiry of a patent; and the patent-registration linkage, which prevents the registration of a generic manufacturer before the expiry of patent. According to a report jointly prepared by Corporate Europe Observatory and India FDI Watch, the consequences of such a decision would be far reaching. “As the source of 92% of the AIDS medicines used in developing countries today, India is the pharmacy of the developing world. So, the impact of this also stretches far beyond India,” states the report.
On the contrary, the Indian apparel and textiles sector is one of the few sectors that has a significant upside potential if the India-EU free trade agreement comes into play. The EU accounts for about 50% of India’s annual apparel and textiles exports of over $13 billion. Hence, the FTA holds a lot of significance for the domestic textile industry, which at present is outpriced by its less developed counterparts in the region. For instance, apparels produced in India cost around 15-20% more than those produced in Bangladesh. Agrees Ajay Sahai, Director General & CEO, Federation of Indian Exports Organisation (FIEO), as he tells B&E, “Because of its least developed country status Bangladeshi textiles and apparels enjoy duty-free access to the EU markets, which is not the case with Indian garments. This will change as soon as the FTA comes into play.” No doubt, the FTA if finalised could improve the weakening sentiment in the Indian textile industry, but then it’s also a well known fact that the retail market of Europe is saturating and hence the supermarket chains like Tesco, Metro, etc are desperately trying to expand their operations beyond the current areas.
Read more.....
Further, EU has been quite insistent on its requirement for ‘TRIPS-plus’ intellectual property protection which exceeds the standards imposed by the WTO’s agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS). If this happens, India’s pharmaceutical sector – which is known for providing cheap life saving drugs to many countries of the third world – will almost crumble. The reports that have come out till now suggest that EU is pressurising the Indian government to extend the period of patents beyond 20 years; data exclusivity which delays the entry of a generic medicine in a market by 10-15 years even after the expiry of a patent; and the patent-registration linkage, which prevents the registration of a generic manufacturer before the expiry of patent. According to a report jointly prepared by Corporate Europe Observatory and India FDI Watch, the consequences of such a decision would be far reaching. “As the source of 92% of the AIDS medicines used in developing countries today, India is the pharmacy of the developing world. So, the impact of this also stretches far beyond India,” states the report.
On the contrary, the Indian apparel and textiles sector is one of the few sectors that has a significant upside potential if the India-EU free trade agreement comes into play. The EU accounts for about 50% of India’s annual apparel and textiles exports of over $13 billion. Hence, the FTA holds a lot of significance for the domestic textile industry, which at present is outpriced by its less developed counterparts in the region. For instance, apparels produced in India cost around 15-20% more than those produced in Bangladesh. Agrees Ajay Sahai, Director General & CEO, Federation of Indian Exports Organisation (FIEO), as he tells B&E, “Because of its least developed country status Bangladeshi textiles and apparels enjoy duty-free access to the EU markets, which is not the case with Indian garments. This will change as soon as the FTA comes into play.” No doubt, the FTA if finalised could improve the weakening sentiment in the Indian textile industry, but then it’s also a well known fact that the retail market of Europe is saturating and hence the supermarket chains like Tesco, Metro, etc are desperately trying to expand their operations beyond the current areas.
Read more.....
For More IIPM Info, Visit below mentioned IIPM articles
Professor Arindam Chaudhuri – A Man For The Society….
IIPM: Indian Institute of Planning and Management
IIPM makes business education truly global
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman
| ExecutiveMBA |
