India and the European Union need to be more cognisant of each other's sensitivities for a faster free trade agreement between the two sides, Commerce and Industry Minister Piyush Goyal said at the 18th Asia Pacific Conference of German Business.

Goyal reiterated the stance that the agreement needed to focus on trade issues rather than aspects like environment, which are the domain of agencies like the UNFCCC.

The minister had mentioned these comments with respect to the EU imposing Carbon Border Adjustment Mechanism and deforestation regulation, which are expected to hurt India’s exports. Finance Minister Nirmala Sitharaman had earlier this month called these rules arbitrary and unilateral.

The minister noted that the EU also needed to realise that India could not be arm-twisted into accepting a bad deal. “We are no longer a pushover. We don’t negotiate from a position of weakness,” said Goyal.
The minister brought up the issue of the dairy sector for the FTA.

“I can’t open up our dairy sector. If they ask me to open up dairy, there is no FTA,” he noted, highlighting that the FTA with Australia did not focus on dairy either.

India’s FTA signed with the EFTA countries from the EU also excluded dairy and soya.

The minister also highlighted the differences between the per capita income between the two economies. “We have a per capita income of $2,500, much below $60,000 for the EU. The EU countries need to understand this,” Goyal said.