Forex Method in European Union

The European Union (EU) is a sterling example of successful economic integration among the countries of a region. Formerly known as the European Economic Community (EEC) the union was born our of the “Treaty of Rome entered into among six European countries-Belgium, Netherlands, Luxembourg France, Germany and Italy-who are also its founder .member its came into operation on January 1, 1958.

Under the Treaty of Rome the member countries agreed to;(i) gradual liberalization of trade among the members with a view of achieving Zero tariff level as early as possible; (ii)evolving a common external tariff among the member countries for inter regional trade(iii) evolving a common agricultural and transport policy;(iv)removal of obstacles to the free movement of persons services and capital: (v) establishing the European Common Market(ECM) with a view to reducing intra-regional income disparities and promote trade among the members and(vi) evolving common fiscal and economic policies to the extent possible for the functioning of the ECM and to remedy disequilibria in their balance of payments.

The member countries agreed to abolish in a phased manner all the tariffs among themselves and adopt a uniform tariff and fiscal barriers. This was achieved by 1968. The next step was to integrate the European Community into a single market with single set of laws, tariffs and fiscal barriers, This was to be achieved by 1992,In June 1985, the European Commission issued the white paper listing various legislative proposals on completing the internal market’, The proposals essentially center an abolishing existing physical, technical and fiscal barriers. These include border controls. Technical standard and regulation and disparities in tax regulations The Single European Act, which became effective in July 1987. Provided the legal basis necessary to implement the integration of European markets .

The European Union is operating as a single market with effect from 1st January 1993 with the elimination of Barriers to the Movements of Goods, services, capital manpower and skills within the boles. At present the membership includes 15 countries with the addition of England, Ireland, Denmark, Greece, Spain, Portugal Austral, Finland and Sweden. Art now constitutes the world’s largest and prosperous market with a share of 40% in the world trade.

One of India’s major trade partners is the EU which accounts for 25% of its exports while the scope for exports has been enlarge by the mere size of the market and flexibility of the quote for different items, the Indian industry has to survive the severe competition arising form throwing open the market to ask. India has signed a trade and economic cooperation agreement with the EU,. This provides for perennial trade between E and India and mantel cooperation in economic and agricultural and industrial development. It is expected that in course of time India my be assigned an associate member status.