Final European Union India
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Transcript of Final European Union India
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EFFECT OF FORMATION OF
EUROPEAN UNION ON INDIAS
FOREIGN TRADE AND INVESTMENTS
Done ByAmita Kachap
Amar KumarVivek Bakshi
Vivek AgarwalAditya Kannan
Malvika Rajesh BhagatSiddharth Sivapurapu
KV Siva Sandeep
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WHAT IS THE EUROPEAN UNION?
Shared values: liberty, democracy, respect
for human rights and fundamental freedoms,and the rule of law.
Largest economic body in the world.
Worlds most successful model for advancingpeace and democracy.
A unique institution Member Statesvoluntarily cede national sovereignty in many
areas to carry out common policies and
governance. Not a super-state to replace existing states,
nor just an organization for internationalcooperation.
Worlds most open market for goods and
commodities from developing countries.
27
7
30
490million
Member States
Combined
population ofEU Member
States
Percent of worldspopulation
Percent ofglobal GDP
55Percent of combinedworldwide OfficialDevelopment Assistance
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EU INDIA EXIM
EU imports from India came to 18.9bn in 2005covering mainly textiles and clothing,agricultural products and chemicals
EU exports to India amounted to 21.1bn, ofwhich the majority was machinery, chemicalproducts and gems and jewellery
Since 2001, bilateral trade between the two hasgrown by 11 % on average
In 2004, India's exports of services to the EUwere valued at 3.8bn, whilst the EU's exports ofservices to India came to 3.2bn
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EU INDIA EXIM Contd.
In 2005-2006, the EU was the main destination ofIndian FDI with one in four dollars invested by anIndian company going to the EU
Indian foreign investment to the EU has increasedfivefold in the last ten years
The EU invested 1.1bn in India in 2004, whichrepresented 1.4% of total EU outflows
EU investment has mainly taken place in the
power/energy, telecommunications and transportsectors
Indian textiles and clothing, a traditional stapleindustry, has significantly benefited from theremoval of textile quotas
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5
Some of the Indian companies in EU
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0
100
200
300
400
500
600
700
1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004
Imports Exports GDP
TRADEVALUE (BILLIONS, CONSTANT2000 DOLLARS)
Source:United Nations,UN COMTRADE database.
Indias Exports, Imports, and GDP
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0.00
5.00
10.00
15.00
20.00
25.00
30.00
35.00
1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005
Exports (from India to EU) Imports (from EU to India)
TRADEVALUE (BILLIONS, CONSTANT2000 DOLLARS)
Note: In 2004, the EU expanded from fifteen to twenty-five countries.Earlier data are for EU-15; post-2004 data are for EU-25.
Source:United Nations,UN COMTRADEdatabase.
The Evolution of India-EU Trade
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Change in Indian Imports and Exports
under Different Trade Agreements
0.00
0.50
1.00
1.50
2.00
2.50
3.00
3.50
4.00
Doha India-EU FTA India-U.S. FTA India-China FTA
Imports
Exports
CHANGE (BILLIONDOLLARS)
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Top 10 EU investorsFrom August 91 to Sept 05
Country US$ bn
Netherlands 1.95
UK 1.90Germany 1.32
France 0.77
Sweden 0.472
Italy 0.467Denmark 0.15
Belgium 0.14
Cyprus 0.084
Finland 0.043
Breakdown of EUs Trade with
India From August 91 to Sept 05 -EU countries accounted for21.08% of total FDI
Top 10 EU countriesaccounted for 20.54% oftotal FDI
Top 10 EU countriesaccounted for 97.45% of
total investments from theEU
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Country US$ bn
Netherlands 1.95
UK 1.90
Germany 1.32France 0.77
Sweden 0.47
Italy 0.46
Denmark 0.15Belgium 0.14
Cyprus 0.084
Finland 0.043
INDIAS INVESTMENTS IN EU
SECTORS INCLUDE
Science & Technology
Infrastructure
Agriculture
Industry
Business Process Outsourcing
(EasternEurope)
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INDIA EU FTA
EU is Indias largest trade partner
India is EUs 5th largest trade partner outsideEurope
India in talks with EU over an FTA since 2007 Speculation is that it may be finalized by Q1 2012
Last India EU summit held in Brussels on 10th Dec2010
Some opposition too to this proposed FTA as there islack of transparency
Also fear of some domestic industries particularlyautomotive being in danger
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The present condition.
Trade in services
EU services exports to India 2010: 9.8 billion
EU services imports from India 2010: 8.1 billion.
Foreign Direct Investment
EU outward investment to India 2010: 3.0 billion
Indian inward investment to EU 2010: 0.6 billion
EU-India trade has grown impressively and more thandoubled from 28.6billion in 2003 to over 67.9 billion in
2010. Trade in goods
EU goods exports to India 2010: 34.7 billion
EU goods imports from India 2010: 33.2 billion
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Trade Implications
Single set of tariffs, trade rules, andadministrative procedures for and to allmembers
India needs to negotiate with only one interfaceto gain access to 27 different nations India also needs to be more competitive since
the EU has over 30 FTAs worldwide
EU tariffs much lower from an earlier average ofaround 9% to around 3.5% now Dealing with one interface and exporting in
larger quantities, India could exploit economiesof scale on shipments
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Indias trade with EU has the potential to reach awhopping $ 572 billion by 2015 once the FTA withthe 27 Nation bloc is implemented.
The India-EU FTA is likely to be fully implemented
by 2015, when Indias trade in goods with the bloccould be around $ 251 bn and trade in services $321billion.
Going by the Study EU trade would account formore than 25% of the countrys GDP which maygrow up to over 2 trillion dollars if 10% economicgrowth is achieved and maintained.At present itsless than 10%
FUTURE PROSPECTS
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THANK YOU