India-UK Free Trade Agreement (FTA): Residual Issues to be Sorted Out This Month 2023

India-UK Free Trade Agreement (FTA): Residual Issues to be Sorted Out This Month 2023

The India-UK free trade agreement discussions are in their last stages. Top UK trade officials will visit India in batches in the second half of this month to resolve any unresolved difficulties before the agreement is signed.

“The final round of negotiations was quite heated, and 19 of the 26 chapters and policy areas were concluded. Problems still need to be solved. Our goal is to resolve the difficulties with the UK when the UK teams visit us in India, and we are confident that they will be resolved, according to Commerce Secretary Sunil Barthwal.

There have been 11 rounds of FTA discussions, and a 12th round is underway. The event will go on through July 25. Top trade officials, including the trade minister, would be in India during this time for the G-20 Trade and Investment Working Group meeting, which would take place from August 21 to August 25.

Both nations will meet to discuss problems about the FTA in New Delhi following the trade and investment working group conference in Jaipur.

The secretary claimed that several nations had approached India about FTA. “We have begun discussions with Peru, and Chile has also expressed interest. We are considering the request to revise the current trade deal with Asean.

Even nearby nations like Bangladesh and Sri Lanka want to join an FTA.

According to him, India is now considering FTAs with nations while taking strategic considerations into account as future requirements for crucial minerals for India’s energy transformation, which will need batteries.

“Some of the smallest nations in terms of acquiring essential minerals. We have a high chance of getting crucial mineral supplies from Peru and Chile, which will benefit us in our energy transition when we switch to creating batteries, according to Barthwal.

The seamless supply of essential minerals, including lithium, nickel, cobalt, manganese, and graphite, which are the main minerals used in batteries, is another topic of discussion in Australian trade agreements.

“As a result, we are now considering FTAs from the perspective of our strategic concerns in addition to trade. So, he added, “That is the novel method we are employing in our FTAs.

India is now willing to sign ambitious FTAs, and other nations are catching on to this trend.

India and the United Kingdom have long been discussing and negotiating to formulate a mutually beneficial Free Trade Agreement (FTA).

An FTA between two nations aims to ease trading barriers, facilitate smoother movement of goods and services, and stimulate economic growth.

However, as with any extensive agreement between two major economies, nuances and outstanding concerns always need addressing.

As we approach the final stages of this negotiation, this article seeks to shed light on the residual issues slated to be resolved this month.

The idea of an FTA between India and the UK has garnered attention, especially post-Brexit. Once the UK left the European Union, it had greater flexibility in framing its trade policies. Simultaneously, India, as a rapidly growing economy, offered a lucrative market for British businesses. Thus, for both countries, this FTA represents an economic opportunity and a strategic repositioning in global trade dynamics.

Tariffs and quotas form the bedrock of any FTA. Both India and the UK have specific sectors where they seek preferential access.

India aims to reduce tariffs on textiles, jewellery, leather goods, and pharmaceuticals. This would help Indian manufacturers find a competitive edge in the UK market. The UK seeks to reduce tariffs on goods like scotch whiskey, automotive parts, and certain agricultural products.

Given the significant IT industry in India and the UK’s robust financial sector, the services sector is of prime importance to both.

India seeks relaxed visa regulations, especially for its IT professionals and service providers. The UK is interested in greater market access for its financial services sector in India.

Data protection norms and digital trade regulations become paramount in an increasingly digital age. India is keen on ensuring data localization and the protection of its citizens’ data. This stands in contrast to the UK’s more liberal approach.

The UK hopes for seamless digital trade, which would require mutual recognition of data protection standards. Guaranteeing the safety and predictability of investments is crucial for foreign investors.

India seeks assurances of protection for its investments in the UK, especially post-Brexit uncertainties. The UK wants a robust framework that safeguards its assets in India, given the past concerns regarding sudden policy shifts.

The recognition and enforcement of IPR is a complex issue, with both countries having unique stances. India seeks flexibility in its IPR regime, especially related to pharmaceuticals, to ensure affordable healthcare. The UK pushes for more vigorous IPR enforcement, reflecting its robust pharma and creative industries.

The India-UK FTA holds enormous potential for both nations. While the outstanding issues are significant, they are manageable. With constructive dialogue and a shared vision of mutual benefit, there’s optimism that these residual issues will be effectively addressed this month, paving the way for a new era in India-UK trade relations.