India's trade regime and regulatory environment still remain comparatively restrictive, according to the "Trade and Investment Barriers Report 2011" published recently by the European Commission, the EU's executive body.
The report notes that "in addition to high tariff barriers, India also imposes a number of non-tariff barriers in the form of quantitative restrictions, import licensing, burdensome mandatory testing (such as for tyres for example) and certification for a large number of products as well as complicated and lengthy customs procedures", EuAsiaNews said.
"With regard to intellectual property, some improvement in the IPR enforcement infrastructure has been reported, however there are still significant concerns about India's response to counterfeiting and piracy."
"Furthermore, in the area of procurement, the Indian legislative framework remains incomplete. Major reforms are needed to ensure compliance with international standards and a predictable environment for bidders," the EU report said.
The report argues that the current trade performance between the EU and India falls far short of its potential.
The comprehensive and ambitious free trade agreement with India currently under negotiation could constitute one of the most significant deals concluded by the EU.
A trade deal of this magnitude would generate sizeable benefits to both economies which conservative estimates put in the range of 9 - 19 billion euro, underlines the EU report.
In four years, EU-India trade has increased by 31 percent to over 53 billion euro in 2009 and EU investment to India has more than quadrupled since 2003 to 3.1 billion euro in 2009.