By Aftab Ahmed

NEW DELHI (Reuters) – India has begun trade talks with the European Union (EU) and is open to dialogue with Britain for a free trade agreement, the trade minister said on Saturday, when the third largest economy in Asia sought new markets for its products.

Piyush Goyal said that India was open to engaging with Britain for preferential trade agreements with the ultimate goal of free trade agreements.

He also dialogue with the EU trade commissioner for an agreement that can be started with a preferential trade agreement. He added that the final destination here would also have a free trade agreement.

“We are talking with the European Union and I am having a dialogue with the EU trade commissioner. I am looking for an initial harvest agreement. Open for discussion on various subjects. It is up to the UK and the European Union whoever takes the challenge for the first time,” Goyal said.

Negotiations for a comprehensive free trade agreement between the EU and India were suspended in 2013 after six years of talks.

India withdrew from the Regional Comprehensive Economic Partnership last year because of concerns over China’s access to its markets and was looking for new ways to increase its exports.

The country has also increased trade barriers to block cheap imports from China and replaced them with locally made goods for domestic consumption and exports.

“In addition to medicines, we have textiles, handicrafts, leather, furniture, industrial machinery, toys is an area where India can engage with the UK & EU at competitive prices,” Goyal said.

India’s economic growth is largely driven by local consumption and successive governments have struggled to expand exports.

In the past six years the government of Prime Minister Narendra Modi has sought to encourage exports through various programs such as “Make in India” but with limited success.

(Reporting by Aftab Ahmed; Editing by Christina Fincher)

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