India and EU share a robust commitment to strengthening bilateral cooperation in the financial services sector. In 2024, total services trade between India and EU is around $83 billion. In 2024, India exported $700 million worth of financial services to EU and imported around $600 million worth of financial services from EU.
FTA will provide the necessary institutional and regulatory framework to accelerate bilateral collaboration, facilitate market access, and catalyze deeper integration of the financial systems of both economies. according to an official statement.
The key features of the The India-EU Financial Services Annex include
* India and EU have committed to collaborate on enabling greater interoperability and interlinkages and development of electronic payment infrastructure and convenience of cross-border payments to promote real-time cross border remittances, merchant payments and other transfers.
*India and EU have committed to strengthen collaborative efforts in fintech innovation
*Indian financial institutions are cushioned from arbitrary or discriminatory credit assessment practices in the market.
* The schedules of specific commitments reflect progressive collaboration among both sides, with comprehensive commitments on Market Access and National Treatment in Banking, Insurance and other financial services sectors and subsectors. India’s sectoral offers represent a forward-looking liberalization approach, factoring in the recent liberalization allowing 100 per cent FDI in Insurance sector and featuring enhanced Foreign Direct Investment (FDI) limits of 74 per cent in banking, alongside a liberalized bank branch licensing framework allowing up to 15 bank branches to be established over a four-year period—a significant expansion from the previously offered the General Agreement on Trade in Services (GATS) limits of 12 branches.
Currently, three Indian banks—State Bank of India, Bank of Baroda and Bank of India —maintain branches in the EU, with a combined total of five branches while only one bank —State Bank of India maintains a Representative office in the EU. From the EU, currently five banks, with a combined strength of 33 branches are operating in India, while 17 banks are maintaining their representative offices.
More details here: https://www.pib.gov.in/PressReleseDetail.aspx?PRID=2219812®=3&lang=1
