1. What is the Eurasian Economic Union (EEU)?
The Eurasian Economic Union (EEU) is an economic union of states located primarily in northern Eurasia. The EEU provides for the free movement of goods, services, capital, and labor within its member states. Its current members include Armenia, Belarus, Kazakhstan, Kyrgyzstan, and Russia.
2. What is a Free Trade Agreement (FTA)?
A Free Trade Agreement (FTA) is a pact between two or more countries to reduce or eliminate trade barriers, such as tariffs and import quotas, on goods and services traded between them. FTAs aim to enhance economic ties and promote trade and investment by creating a more predictable and transparent trading and investment environment.
3. Why are India and the EEU negotiating an FTA?
India and the EEU are negotiating an FTA to boost economic ties, enhance bilateral trade, and provide greater market access for goods and services. The agreement is expected to benefit various sectors, including engineering goods, electronics, and agriculture, by reducing or eliminating trade barriers.
4. What are the potential benefits of this FTA for India?
The FTA is anticipated to provide numerous benefits for India, including increased exports, greater market access for Indian goods and services in the EEU market, and strengthened economic relations with the EEU member states. This agreement could also diversify India’s trade partnerships and reduce dependency on traditional markets.
5. What steps have been taken towards formalizing the FTA negotiations?
Senior officials from India and the EEU met on March 28 to formally initiate the negotiations for the FTA. Prior to this, two feasibility studies were conducted to assess the potential impact and benefits of the proposed agreement.
6. Who are India’s major trading partners within the EEU, and what is the trade volume?
Russia is India’s largest trading partner within the EEU, with bilateral trade amounting to USD 49.4 billion in the fiscal year 2023. Trade volumes with other EEU members like Armenia, Belarus, Kazakhstan, and Kyrgyzstan, although significantly smaller, are also crucial parts of India’s trade network.
7. Has India signed similar agreements with other countries or blocs?
Yes, India has previously signed a similar agreement with the European Free Trade Association (EFTA), which includes Iceland, Liechtenstein, Norway, and Switzerland. These agreements are part of India’s broader strategy to engage in beneficial trade agreements with key economic blocs and countries around the world.
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