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Among the unresolved issues under the Doha Round negotiations of World Trade Organization (WTO), an agreement in General Agreement of Trade in Services (GATS) has so far been particularly eluding, owing to the problems relating to request-offer framework and difficulties in addressing the non-transparent nature of trade barriers, for example, movement of natural persons (Mode 4). The failure of the WTO to secure free trade among member countries, even after two decades of the multilateral body coming into existence, has motivated many countries to move towards regional trade agreements (RTAs) for enhancing trade both in merchandise products, as well as key services and investment. This route is particularly important for India, a country that enjoys a trade deficit in merchandise products but a surplus in professional service exports. Also, foreign direct investment (FDI) inflows is particularly important for technology transfer and productivity growth. The inclusion of trade in services and investment provisions in India’s recent Comprehensive Economic Cooperation Agreements (CECA) with Singapore and Malaysia, and also in the Comprehensive Economic Partnership Agreements (CEPA) with Japan and South Korea indicates the country’s acknowledgement of this perspective. European Union (EU), the largest importer of services, is one of the most attractive destinations for India’s service exports. However, India’s export to the EU is subject to various market access challenges, for example, presence of several non-tariff barriers (NTBs). While the negotiations for entering into a Bilateral Trade and Investment Agreement (BTIA) with the EU is going on since 2007, the end of the tunnel is not really in sight. In this context, the recent volume edited by Mukherjee, Chanda and Goyal is a well-structured and timely contribution to the literature, which analyses the issues pertaining to Indo-EU trade potential and challenges across various sectors. The introductory chapter by Mukherjee, Chanda and Goyal notes that while there is a rich literature on the effects of trade agreements and trade liberalisation in the services sector, the quantification of sectoral benefits in case of services sector involving developed and developing countries is a difficult exercise. EU-India provides a unique case study in this regard. While India is on the path of service sector reform over the last couple of years, EU is slowly coming out of Book Review

recession. Given the complementarities in services sector, a successful conclusion of the BTIA would augment the competitiveness of both partners. It would also enhance their contributions in global value chain, as EU and India are currently negotiating mega-blocs like Transatlantic Trade and Investment Partnership (TTIP) and Regional Comprehensive Economic Partnership (RCEP) respectively.
Goswami, in the second chapter, compares the governance structure of the services sector, their classification system, contribution to GDP and employment, and the liberalisation drive in the EU and India respectively. It is observed that while in the EU most services are in the organised corporate segment, in contrast, majority of the Indian service players are in the unorganiszed or non-corporate category. While the sector acts as a growth driver in both the partners, the major challenges to future trade growth include lack of a long-term coherent strategy for promoting exports from India, presence of national regulations at sector level in several EU countries, etc.
Looking at the global trade flows in services, the third chapter by Goswami reports that the presence of both EU and India has deepened on the global canvas over the years. The competitiveness of them at sectoral level can be ascertained from the Revealed Comparative Advantage (RCA) which is particularly high for India in the computer and information services and the other business services (professional services) categories. In addition, global as well as bilateral investment outflows from EU and India are increasing over the period. However, the investment flows are often obstructed by regulations on foreign ownership and investment requirements, multiplicity and heterogeneity of regulations, restrictions on the movement of persons, and so on.
In addition to freeing regulations on trade, improving logistics infrastructure can significantly contribute in the process. After conclusion of the BTIA, the demand for logistics services is likely to go up. Miglani, in the fourth chapter, provides a detailed account of the logistics services in the two partners, noting that as per the World Bank Logistics Performance Index (LPI) in 2014, India (46) ranks behind the EU-27 average (37). While EU has integrated the logistics process effectively since the 1990s, in India the logistics sector reform is an ongoing process. Presently while India's share in EU logistics market is insignificant, EU has enhanced its share in Indian logistics industry. Through a primary survey it is observed that while the barriers in the EU market include infrastructure bottlenecks, complex regulatory environment, incomplete liberalisation, discriminatory policies, Mode 4 barriers etc., in India the challenges originate in the arena of infrastructure bottlenecks, inter-state variation in laws, technology-related barriers, skill-related barriers, Modes 3 and 4 related barriers, etc.
Given the fact that demand for energy service cut across sectors, it bears a major consequence on future growth prospects. The fifth chapter by Miglani provides a detailed overview of the energy sector in the two partners, followed by an analysis on the market structure and liberalisation policies therein. A primary survey of Indian and European firms reveals that while the barriers in the EU market include government procurement provisions, complexities relating to regulatory and discriminatory policies, incomplete liberalisation, etc., in India the challenges originate in the sphere of monopoly-induced inefficiencies, presence of multiple governance bodies, tax-related problems, infrastructural bottlenecks, skill-related barriers, etc.
IT-enabled services are the major export earner for India since the 1990s and EU is one of the lucrative target markets. Particularly, offshoring of IT-enabled services by European clients has been a regular feature, given the labour cost advantage enjoyed by India. Satija in the sixth chapter tracks the regulatory framework in India and the bilateral trade flows in this category. Interestingly, during 2010, India has a trade deficit with EU in this category. A primary survey involving Indian and European firms reveals that while the barriers in the EU market include barrier to labour mobility and investment, provisions on data protection, government procurement provisions etc., in India the challenges come from underdeveloped infrastructure, inadequate supply of skilled workforce, regulatory bottlenecks, lack of R&D initiatives, weak hardware industries, etc.
The accountancy sector is increasingly playing a crucial role both for smooth functioning of the capital market and demand for international standards. However, delivery of service in each country is generally subject to various accreditation requirements and procedures. The seventh chapter by Pal analyses the accountancy sector in EU and India, and identifies the opportunities for India, particularly across Modes 1, 3 and 4. Strategies such as entering into a Mutual Recognition Agreement (MRA) with EU, using entry to India under Mode 3, etc. are likely to provide wider avenues for India in EU market.
The increasing use of e-healthcare delivery in the EU countries enables Indian service providers to be part of the value chain there. However, entry in health services market in EU is limited by several regulations such as data protection and privacy requirement, registration and compliance with accreditation norms, etc. Chanda, in the eighth chapter, notes the opportunities for Indian players across all modes-Mode 1 (tele-medicine), Mode 2 (movement of patients), Mode 3 (setting up of hospitals) and Mode 4 (movement of doctors, nurses and midwives). For enhancing Indian exports to EU, there is an urgent requirement for focusing on several areas, namely-streamlining constraints to Mode 1 delivery, enhancing patient movement and augmenting insurance portability, tackling visa restrictions, etc.
With the growing focus on climate change issues, environmental services has emerged as a major area of discussion. Moreover, in India, with the launch of the 'Swacch Bharat' campaign, waste management services are becoming increasingly important. Comparing the offers made at the GATS negotiations, the ninth chapter by Sawhney notes that both partners have so far treaded along this path with caution. While in the past, EU has included this service in its RTAs with Chile and South Korea, India has also included refuse disposal services and sanitation and similar services in its comprehensive agreements with Japan, South Korea and Malaysia. While trade opportunities exist, there are several country-specific entry barriers in the EU market, in addition to provisions on labour mobility. On the other hand, EU firms perceive barriers in Indian market in the form of complexities in obtaining visa and licenses, lack of clarity on taxation provisions and enforcement norms etc.
Given the persistence of disguised unemployment, unorganised retail in India is strongly visible and the reform of FDI limit has become a major policy debate. Investment barriers exist in both partners; in the form of FDI limitation and associated conditions in India and stringent regulatory barriers in the EU countries. Glancing through the retail market and the relevant regulations, Goyal in the tenth chapter, discussed the opportunities for both sides in retail services. A primary survey reveals that while the barriers in the EU market include Economic Needs Test (ENT), product-specific regulations, Labour Market Test (LMT), differences across EU countries etc., in India the challenges are in terms of inadequate infrastructure, regulatory issues and policy uncertainty, high cost of setting up operations etc.
The concluding chapter by Mukherjee and Goyal notes that the ongoing deepening of the Indo-EU relations will be facilitated by the successful conclusion of the BTIA, which will enhance competitiveness of both partners. However, much of the delay in the negotiation is from the Indian side, as India wants to undertake reforms first and bind for the BTIA later. Therefore, reforms in key service sectors in India need to be undertaken without delay.
As the Indo-EU BTIA negotiations are still going on, the present volume, which extensively discusses the bilateral trade and investment opportunities and regulatory barriers across select service categories, is a must-read reference for academicians, policymakers and researchers who have keen interest in this area.

Debashis Chakraborty
Indian Institute of Foreign Trade, New Delhi, India E-mail: debchakra@gmail.com