India, UK to meet for FTA talks this month
Financial Express - 08 July 2024
India, UK to meet for FTA talks this month
By Mukesh Jagota
The UK is India’s 16th largest trading partner with a total goods exchange of $ 21.3 billion dollars in the last financial year.
WIth business of government formation over in India and UK, officials from both sides will get together later this month itself to carry forward the negotiation process on the proposed Free Trade Agreement between the two countries.
Currently, the 14th round of talks are in progress on the FTA negotiations for which began in January 2022. Even when the election process was on, both sides had been engaged in talks. Indian officials had visited the UK in April for the talks.
“The two sides are in touch with each other and will meet this month itself,” a senior official said.
On Saturday Prime Minister Narendra Modi had a telephonic conversation with UK Prime Minister Keir Starmer, their first after the elections. “We remain committed to deepening comprehensive partnership and robust India-UK ties for the progress and prosperity of our peoples and global good,” PM Modi posted on ‘X’.
Starmer’s office statement in the talks said both the leaders discussed FTA. “The Prime Minister (Starmer) said he stood ready to conclude a deal that worked for both sides.”
The Labour party manifesto has also said that it would seek a new strategic partnership with India, including a free trade agreement.
According to officials chapter wise textual negotiations on the FTA are nearly closed and schedules on goods and services are in an advanced stage of negotiations. “Work is in progress on resolving pending issues.”
The India-UK FTA has 26 chapters or policy areas and the schedules in FTA deal with tariffs which each side will impose on goods from other countries under the agreement. So far India and Uk have held 13 rounds of negotiations on the FTA and the 14th round which started in January is in progress.
The policy areas covered by FTA are Intellectual Property, Government Procurement, Sanitary and Phytosanitary Measures, Technical Barriers to Trade, Competition, Rules of Origin, Trade Facilitation, Customs Cooperation, Small and Medium-Sized Enterprises, Trade and Sustainable Development, Labour, Gender, Digital Trade, Dispute Settlement, General Provisions and Transparency.
Experts say that while both sides are committed to the deal there could be adjustments in the view of Labour’s views on immigration and dependence on foreign workers. Key Indian demand in the services negotiations is greater access to Indian professionals to the UK market.
The UK is India’s 16th largest trading partner with a total goods exchange of $ 21.3 billion dollars in the last financial year. India’s exports to the UK grew 13.3% to $ 12.9 billion while imports fell 6% to $ 8.4 billion. Smartphones and aviation turbine fuel was the biggest item of export to the UK. Services exports to the UK in 2023 were $ 17.2 billion while imports were $ 12.4 billion.
Along with the FTA, India and the UK are also negotiating a Bilateral Investment Treaty. India and the UK are aiming to sign the investment agreement along with the FTA. UK is the sixth largest investor in India between April 2000 and March 2024. Its share in total FDI during the period was 5.17% of the total of $ 35 billion. For Indian investors the UK is the fifth biggest destination. Between 2000 and 2024 outbound FDI from India to the UK stood at $ 19 billion.
