Whilst welcoming the inclusion of some standard human rights elements in the recently negotiated EU-India free trade agreement (FTA), CSW is concerned by the exclusion of the chapter on sustainable development from dispute settlement. This concession means that any non-compliance by India in this area will not be eligible for adjudication.

In all of its recently negotiated comprehensive FTAs, the EU has insisted on including a chapter called Trade and Sustainable Development (TSD), which includes some human rights elements. However, while this chapter within the agreement with India does provide for some cooperation-based alternative avenues for addressing non-compliance in human rights, the exclusion of the TSD chapter from dispute settlement means that the EU has limited itself from this way of exercising ‘hard leverage’ - threats to suspend parts of the agreement on human rights grounds.

While the agreement still contains an ‘essential elements’ clause relating to democracy and human rights, which technically permits for EU action on human rights grounds, making use of this option would only be possible through a decision made at the highest level, meaning it would be extremely unlikely to be used.

Ongoing discrimination in India has created a cycle of poverty and disenfranchisement for religious minorities, Adivasis and Dalits by restricting their access to education, fair employment and legal protection. These groups are disproportionately affected by unfair labour practices, including debt bondage and modern slavery, which are frequently hidden within the export sectors that the EU-India FTA seeks to expand. The concession described means that these marginalised communities, who remain vulnerable to state-sanctioned discrimination and corporate exploitation, have been denied one of the credible international mechanisms available (and which have been standard in other EU FTAs) to hold violators accountable.

CSW’s Senior EU Advocate Jonathan de Leyser said: ‘Some may wonder why this matters, given that the EU has a low track record of using ‘hard leverage’ on human rights grounds in free trade agreements. It is also true that most civil society organisations (CSOs), including CSW, refrain from calling for blanket trade measures to be taken, since these indiscriminately and negatively impact the general population far more than the decision makers. What both the EU and CSOs will agree has been useful, however, is the ability for the EU to pose a credible threat toward human rights reform through the hard leverage that threats of tariffs and other trade preferences provide.

‘This is explicit in the EU's rationale for its GSP+ scheme, for example, which it applies to Pakistan, Sri Lanka and others; and proves that the EU has no objection in principle with using this kind of leverage toward human rights reforms. We are concerned that this sets a negative precedent for future FTAs, as future trading partners may now make reference to this concession and demand equal treatment.

‘All of this matters because our experience of advocacy on states who routinely neglect or actively violate human rights is that they are reluctant to change their behaviour unless they are forced to face a potential price for it. This price can be either reputational or economic - regrettably, the EU has missed an opportunity with respect to its options on the latter.’