Author: HANSHIKA MOHAPATRA, a student at Xim University, Bhubaneswar, Odisha.
TO THE POINT
The India-EU Free Trade Agreement (FTA) seeks to increase trade and investment by decreasing barriers and standardising bureaucratic regulatory frameworks. In a dualist system, India must constitute convention commitments domestically as per Article 253 of the Constitution, whereas the EU negotiates within its unified legal frame under Article 207 of a unified legal system, established by the Treaty on the Functioning of the European Union (TFEU). Harmonising intellectual property laws, data protection regulations, and digital commerce morals are among the most burning legal enterprises. There are also enterprises about investor-state dispute settlement (ISDS), which may have an impact on India’s regulatory sovereignty. Labour and environmental clauses may put pressure on domestic reforms. The FTA’s success is dependent on combining international duties with constitutional safeguards, which ensure that any legal commitments preserve parliamentary supremacy and the public interest. This results in a structural and legal disparity in how both parties approach and implement trade agreements.
USE OF LEGAL JARGON
i).MFN (Most favoured Nation)- It is a principle in international trade in which a country agrees to treat another country equally with any other country that receives preferential treatment.
ii).TBT (Technical Barriers to Trade)- It seeks to ensure regulations/standards through non tariff measures and compliance with prservative policy such as health, environment and safety.
iii).TRIPS (Trade related to Intellectual Property Rights)- An agreement under the World Trade Organisation (WTO) that establishes global standards for intellectual property rights protection and enforcement.
iv).Dualist System- Means that international rules are not automatically integrated into a country’s domestic legal structure;rather, they must be deliberately absorbed or turned into national law through a legislative procedure.
v).ISDS (Investor-State Dispute Settlement)- An international investment law system that enables foreign investors to bring legal action against states.
ABSTRACT
This article addresses the ongoing India-European Union Free Trade Agreement (FTA) negotiations from a legal perspective, focussing on the ramifications for India’s international commitments and domestic legal architecture. While the FTA aims to deepen economic integration and lower trade barriers, it poses complex legal challenges in terms of regulatory framework harmonisation, particularly in intellectual property rights (IPR), data security, labour and environmental regulations, public procurement, and electronic business. The study investigates the structural contradiction between India’s dualist legal system, which requires legislative treaty implementation, and the EU’s supranational legal regime, as stipulated by paper 207 of the TFEU. It critically evaluates the vulnerabilities to India’s judicial sovereignty posed by investor-state dispute settlement (ISDS) systems, as well as the constitutional and federal implications of binding agreements. Furthermore, it emphasises the potential necessity for domestic legislative reforms to assure treaty compliance, as well as the significance of balancing sovereign regulatory space with international trade duties. In its conclusion, the article outlines the legal opportunities for a fair, enforceable, and constitutionally sound trade deal.
Treaty Negotiation Process and Legal Instruments
Treaty negotiations in India are led by the executive without the need for parliamentary approval, using powers granted by Article 73 and Entry 14, List I. Treaties such as FTAs and BITs are signed as international agreements, but they require local legislation to be enforced. In contrast, the EU follows a systematic process under Article 207 TFEU, which includes the European Commission and is ratified by the European Parliament, ensuring stronger institutional checks.
Key Legal Challenges (Pitfalls)
The FTA confronts legal challenges in harmonising India’s legislation with EU norms, particularly in terms of TRIPS-plus IPR demands, data protection disputes (GDPR vs. India’s DPDP Act), and stringent SPS/TBT rules. The EU’s desire for access to public procurement markets has also raised constitutional and policy problems. In the absence of proper legislative safeguards, these pledges may limit India’s regulatory autonomy and have an impact on basic rights.
Investment and Dispute Resolution
ISDS clauses in the FTA may empower foreign investors to sue India in international tribunals rather than domestic courts. This undermines India’s legal sovereignty, restricts judicial scrutiny, and may limit future policy decisions in public interest industries.
Labour, Environment & Sustainable Development Clauses
The EU demands binding commitments on labour rights and environmental protection in the FTA. This could pressure India to amend domestic laws, raising concerns over legal preparedness and potential intrusion into its legislative and policy autonomy.
Enforcement and Domestic Legal Reforms
The FTA’s implementation will necessitate changes to India’s domestic laws, particularly those governing intellectual property, data protection, competition, and technical standards. Ensuring legal enforceability requires explicit legislative action and robust regulatory structures to reconcile treaty obligations with domestic law.
CONCLUSION
The India-EU Free Trade Agreement is a milestone moment in India’s global trade engagement, with major legal and constitutional ramifications. To be truly helpful, the deal must strike a delicate balance between advancing economic interests and maintaining India’s regulatory authority. It is critical to ensure constitutional consistency, protect federal interests, and preserve judicial sovereignty. A transparent negotiation process, inclusive stakeholder input, and strong legislative monitoring will be required to create an FTA that is not only legally binding but also equitable and resilient in the long run.
FAQ
1. Why is India’s legal system referred to as “dualist,” and how does it effect FTAs?
India has a dualist system, which means that foreign treaties do not become domestic law without enabling legislation. This creates a legal chasm between international obligations and domestic enforcement.
2. What are the most significant legal challenges India confronts as part of this free trade agreement?
-TRIPS-plus-IPR responsibilities
-Conflicts over data protection (GDPR vs. DPDP Act)
-ISDS processes are compromising judicial sovereignty.
-Labour and environmental conditions
3. What is the India-EU Free Trade Agreement’s legal foundation?
According to standpoint of law, the FTA offers both advantages and disadvantages. It is possible to connect it with India’s constitutional ideals and long-term legal stability by implementing appropriate protections, legislative change, and transparent talks.
