The Russian Ministry of Economic Development plans to start free trade zone (FTZ) negotiations with India and Egypt and make a temporary pilot agreement with Iran, Deputy Minister Alexei Gruzdev told reporters on Wednesday, according to TASS.
“Regarding India and Egypt, I think we will start talks this year, probably closer to the year-end. Negotiations with Israel have already started. Therefore, our agenda is fairly packed for near time,” Gruzdev said.
Negotiations can normally last two to three years, Gruzdev said, adding, “We are certainly not in the mood to protract this process but at the same time we cannot forecast how much time will it take.”
In 2014, Russia launched another major trade consolidation, the Eurasian Economic Union (EAEU) treaty, which was signed in May 2014 by the leaders of Belarus, Kazakhstan and Russia. Treaties with Armenia and Kyrgyzstan were signed in October and December 2014, respectively. Kyrgyzstan joined in August 2015.
The EAEU is designed to reach a number of macroeconomic objectives such as reducing commodity prices by reducing the cost of transportation of raw materials, increasing return on new technologies and products due to the increased market volume, and promoting “healthy” competition in the common market.
It is also designed to lower food prices, increase employment in industries and increase production capacity.
The EAEU is considered as a major player in the world’s energy sector, raw materials, weapons industry and agricultural production. The significant potential for developing infrastructure has led the member states and its partners to create links by constructing roads, railways, electric power grids and fibre-optic cables.
Negotiations are also underway now between the EAEU and Iran on a pilot preferential agreement.
“Indeed these are not classic talks on the free trade zone because Iran is not a member of the World Trade Organization. Development of a preferential agreement leading to establishment of the free trade zone was the case in point from the very start,” Gruzdev said.
The countries are currently negotiating the list of goods items to receive special trade conditions Gruzdev said: “There is unity from standpoint of the Union [EAEU]; no final list because the list is the subject matter of talks.”
The list will contain 200-300 positions addressing the interests of Iran and the EAEU at the initial phase. Iran is mainly interested in agriculture and certain positions in mechanical engineering, according to Gruzdev.
“The interest of the Union is certainly much broader, considering the differentiation of our economy; therefore talks continue,” he said, adding that the pilot agreement with Iran may be signed this year.