India-Eurasian Economic Union Free Trade Agreement (FTA)

Context

During his two-day visit to India, the Foreign Minister of Belarus declared that India is considering starting talks for a free trade agreement (FTA) with the Eurasian Economic Union (EAEU).

India Seriously Considering India-Eurasian Economic Union Free Trade Agreement (FTA)

• The remarks indicate a deepening political will to strengthen economic relations between India and Belarus, which has been one of the key regional supporters of Russia in the backdrop of the Ukraine-Russia conflict.
  • Under FTA, two or more countries agree to provide preferential trade terms, tariff concessions, etc. to the partner country. 

About Eurasian Economic Union (EAEU)

• Background: The Eurasian Economic Union was created in part in response to the economic and political influence of the European Union (EU) and other Western trade agreements.
• About: The EAEU is an international economic union and free trade zone comprising countries located in central and northern Asia and Eastern Europe. 
• Objective: To increase cooperation and economic competitiveness for the member states, and the promotion of stable development to raise the standard of living in member states.
• Governing Body: The EAEU heads of state comprise a governing body known as the Supreme Eurasian Economic Council.
• Executive body: Known as the Eurasian Economic Commission, an analog to the European Commission, it oversees day-to-day operations. 
• Member countries:  Russia, Armenia, Belarus, Kazakhstan, and Kyrgyzstan.
• No Common Currency: Unlike the European Union (EU), the EAEU does not share a common currency.

Limitations of Eurasian Economic Union (EAEU)

• Internal disagreements and Uneven Markets: Members of the union have different goals, and there are recurrent clashes between members over the application of non-tariff regulations and accusations of protectionism.
• Limited Economic Success: Failure In the eight years since its creation, the EAEU has failed to establish itself as a profitable economic alliance or attract new member states. 
• Uneven Resolution of Benefits and Duties: The resolution of benefits and duties within the alliance has consistently favored Russia, posing ongoing challenges for Kazakhstan, Armenia, and Kyrgyzstan.

News Source: The Hindu

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