Ministry of commerce and Industry stated that India and the United Kingdom (UK) are planning to launch formal negotiations of Free Trade Agreement (FTA) between them by 1st November. Further, the ministry added that they plan to produce an interim pact between India-UK by March 2022. Selected goods and some key services which are “immediately deliverable” will be included under the interim trade pact.
The negotiations will include tariff cuts and access to larger market. Both sides might further explore the mutual recognition agreements on some selected services including architecture and nursing. Pre-pandemic, India exported US$ 8.7 billion to the UK during FY20 while its imports from the UK were US $6.7 billion. However, India-UK bilateral trade fell to US$13.2 billion in FY21. India top exported products to the UK are textiles & garments, gems and jewellery and certain capital and consumer goods while its imports capital and consumer goods from UK in large quantity.
Negotiations with the UK come under India’s strategy to forge “fair and balanced” trade agreements with some key economies and update the existing agreements of India to enhance trade. Balanced FTAs will, furthermore, assist India in achieving sustained growth rates in exports over the upcoming years. Goyal said there is “keenness to have an early conclusion of negotiations for quick and early economic benefits to businesses on both sides (India and the UK)”.
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