On the eve of the EU-India Summit in New Delhi on February 10th, SOMO has contributed to an analysis of the ongoing negotiations between the EU and India on a free trade agreement (FTA). Together with civil society organisations in India and Europe and its partner Madhyam, SOMO has expressed its concern about the negative impact of this FTA on vulnerable communities in India. Negotiators and politicians within the EU and in India have refused to listen to these objections. A protest rally by civil organisations, farmers and trade unions has therefore been held during the summit on February 10th.
In co-operation with Madhyam, SOMO has made an analysis of the European demand that India should open up its financial sector (please check this link for more information). European banks are generally only catering for the rich middle classes and have no branches in rural areas where banking services are most needed. Besides they are very active in developing and trading high risk financial products (derivatives) which may well lead to instability in India (as happened in South Korea). What is more, in view of the fact that serious reforms of the European financial sector are far from being finalized and implemented, and given that European banks are aiming at making huge profits in India, it is likely they will act in a risky manner (see also SOMO’s Newsletter over de EU financial reforms). Finally, under the new FTA rules, it is very likely that financial regulation in India and in Europe will be seriously restricted (for more information, please read Business As Usual).
SOMO has demonstrated that the liberalisation of investments and new rules aiming at the protection of European investments under FTAs primarily benefit European business, while undermining democratic decision making and social rights in the receiving country ('The Netherlands: A Gateway to Treatyshopping').
Opening up the Indian market to foreign supermarkets has previously generated such protests that Parliament in India had come to a halt. Many small shops, informal vendors and suppliers are now at risk of losing their jobs with no other employment in sight.
Civil society organisations have given a press conference in New Delhi from 2-4 PM local time in the Press Club of India to share their objections and information from the assessments they have done among various parts of the population.
SOMO Senior Researcher Myriam Vander Stichele has been present at this press conference and can be reached for more information on: + 31 6 12060158.