Financial Daily from THE HINDU group of publications
Thursday, Apr 29, 2004
Industry & Economy
`India will benefit from expanded EU market'
New Delhi , April 28
INDIAN exporters are going to benefit more from the integration of 10 countries with the European Union as the bilateral trade between India and the acceding countries is in India's favour.
Speaking at the roundtable on `India and New Europe: Emerging perspectives,' organised jointly by the Federation of Indian Chambers of Commerce and Industry (FICCI) and the European Commission here on Wednesday, Mr Francisco da Camara Gomes, Ambassador of Delegation of European Commission to India, said this while outlining the benefits of EU enlargement (where 10 countries will integrate with EU on May 1, 2004) and its impact on India.
Elaborating further, Mr Gomes said that Indian exporters would benefit from this also because the EU is India's largest trading partner and Indian exporters are already aware of what it takes to export to the EU. Thus, Indian exporters, who will use their experience and knowledge to expand their market in these countries, already know the new rules of the game for these 10 countries, he added.
Mr Gomes further pointed out that the enlargement would bring forth an even bigger market with a population of almost 455 million and a GDP of around euro 9,712 billion (euro=Rs 53.50), the enlarged EU would account for some 18 per cent of the world trade. It is notable that the current EU is already the largest single market in the world and with the harmonisation of regulations and standards, circulation of goods and services will increase multi-fold.
He stressed that the third countries will benefit immensely from an expanded single market and a simplified and enhanced access to the acceding countries current markets.
Mr Gopal Pillai, Additional Secretary, Ministry of Commerce, said that the enlargement of the EU will enable Indian goods to reach EU markets from other entry points as bulk of trade to Europe from India happens through Rotterdam at present.
Mr Pillai suggested the need for Indian companies to re-position themselves, especially in Eastern and Central Europe, keeping in mind that EU standards are often higher than the global standards and once the acceding countries integrate themselves with EU they will have similar high standards.
In her address, Ms Bhaswati Mukherjee, Joint Secretary (Europe 1), Ministry of External Affairs, highlighted the untapped potential for cooperation between the EU and Indian companies. In areas such as power generation, transmission and distribution - where state monopolies are being deregulated and domestic private enterprises are looking for joint venture partners - European companies can look for newer opportunities for investment, she said.
Port management, construction and maintenance of roads, privatisation of airports, agro processing, insurance and banking, and medicare are some of the key areas where collaborations between Indian and EU companies can be mutually beneficial, she said. On the issue of business process outsourcing, Ms Mukherjee pointed out that offshoring would result in a huge gain to EU companies and to their national economies.
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