India not a candidate for sanctions as its petro exports to EU are compliant with norms: EAM Jaishankar

Sandeep Dikshit

New Delhi, May 17

India and the European Union held their maiden Trade and Technology Council (TTC) meeting with an unprecedented participation from three Cabinet Ministers but differences came to the fore on two key issues which both sides maintained would be addressed in a spirit of friendship.

The importance of the India-EU TTC can be gauged from the fact that it is only the second such mechanism by Brussels. Its sole TTC till now was with the US.

But at a post-TTC press conference, Jaishankar responded tersely to EU Foreign Policy chief Josep Borrell’s remarks calling for action against Indian refined products exported to Europe from Russian crude.

Asked if Borell had broached this issue during the bilateral, Jaishankar said, “I don’t see the basis for your question. My understanding of (European) Council regulations is that if Russian crude is substantially transformed in a third country then it is not treated as Russian anymore. I would urge you to look at Council regulation 8332015,’’ he said at a media conference.

“I will not add to this,’’ said EC Executive Vice-President Margrethe Vestager while stating that “there are no doubts about the legal basis of sanctions. Of course, it’s a discussion we will have with friends but with extended hands and not pointed fingers. That would go without saying.’’ She also referred to the spirit of TTC which indicates “a very, very strong willingness to substantially strengthen that partnership.’’

“I echo that,’’ said Jaishankar.

The other issue of discord is the EU’s proposal to impose a 20 to 35 per cent additional import duty on high-carbon goods like steel, iron ore and cement, all of which India exports to Europe.

Against the backdrop of reports that India plans to challenge this additional duty at WTO, EC Executive Vice-President Valdis Dombrovskis said the proposal is fully compliant with WTO norms. He said the TTC is a good platform to deepen engagement on the EU’s Carbon Border Adjustment Mechanism (CBAM) which he pointed is non-discriminatory. “We apply the same price of carbon on imported goods and domestic producers. Indeed, we have agreed to remain engaged with India on this important topic,’’ he observed.

Commerce Minister Piyush Goel put faith in dialogue. “Between friends it is always good to talk openly and on a wide variety of issues. CBAM is a mechanism that the EU has proposed and we remain engaged. I am sure the intention is not to create a barrier for trade but find a way forward so that sustainability is as much a part of our collective efforts to leave behind a better planet for future generations. We are discussing the issue. We have a long time ahead of us working together to find the right solutions to this,’’ he said.

The Minister also dispelled the impression that India has high import tariffs. A free trade agreement would address most of the EU’s complaints in this regard. “India’s (import) tariffs are misconstrued to be high. On most materials, it is generally very low. Many items are helping the Indian economy grow, so actual applied rates are lower than WTO bound rates.

“One must appreciate that a developing country providing for the needs of such a large population and work opportunities to 800 million in the working age has its own dynamic. One must also recognise our ability to compete with certain geographies that are relatively non-transparent on many products. Developed countries are the unintended consequence. That’s why FTA will give a huge opportunity and opening to provide innovative R & D. It will bring to the EU, Indian goods at high quality at very competitive prices. It will be good for the EU as the imports will be from a democratic country that is aligned to the thinking of the EU,’’ he said.