India and UK to resume free trade agreement talks tomorrow
What's the story
India and the United Kingdom will resume negotiations on a proposed free trade agreement (FTA) tomorrow, after an eight-month hiatus.
UK's Secretary of State for Business and Trade Jonathan Reynolds will be in India for the talks. He will meet Commerce and Industry Minister Piyush Goyal.
UK's Minister of State for Investment, Poppy Gustafsson, will also join Reynolds on his visit.
Negotiation timeline
A look at the history of India-UK FTA negotiations
The India-UK FTA talks were started on January 13, 2022. Since then, 13 rounds of negotiations have been held till December 2023.
The UK side suspended the ongoing 14th round in May 2024 due to elections in their country.
The upcoming discussions will build on previous progress and bridge existing gaps for a swift conclusion of the trade deal.
Agreement details
What does the proposed trade agreement entail?
The proposed FTA seeks to boost bilateral trade and investments by either removing or substantially reducing customs duties on most goods traded between India and the UK.
The pact also aims to ease regulations for facilitating trade in services and bilateral investments.
The Indian industry is pushing for greater access for its skilled professionals from IT, healthcare, etc, in the UK market, and market access for several goods at zero customs duty.
Trade expectations
UK's demands and India's potential concessions
The UK is pushing for a significant reduction in import duties on Scotch whiskey, electric vehicles, lamb meat, chocolates and some confectionery items.
It is also seeking more opportunities for UK services in Indian markets in sectors such as telecommunications, legal and financial services.
India may be open to negotiating its high tariffs on Scotch whisky but not to the extent it has agreed with Australia.
Trade growth
Bilateral trade and investment treaty
Bilateral trade between India and the UK increased to $21.34 billion in 2023-24 from $20.36 billion in 2022-23.
The two nations are negotiating a 26-chapter bilateral investment treaty (BIT) covering services, goods, investments, and intellectual property rights.
The UK is India's sixth-largest investor, with a total FDI of $35.3 billion from April 2000 to September 2024.