The UK PM’s office emphasised its commitment to negotiating a trade deal with India, stating that boosting trade abroad is essential for strengthening the domestic economy. Both countries aim to establish a new strategic partnership, including a trade agreement, while deepening cooperation in security, education, technology, and climate change.
Both leaders underscored the importance of promptly resuming Free Trade Agreement (FTA) negotiations to address pending issues to mutual satisfaction.
Prime Minister Modi highlighted the significance of tackling the issue of economic offenders from India in the UK. They also agreed on the need to make progress on matters related to migration and mobility. The UK welcomed India’s announcement to establish two new Consulates General in Belfast and Manchester.
India’s Department of Commerce welcomed the announcement to relaunch talks in the new year, noting that dates will be finalised through diplomatic channels soon. The Department emphasised that the negotiations will build upon the previous progress as both countries seek to enhance bilateral trade.
From April to September 2024, India’s exports to the UK grew by 12.38%, reaching $7.32 billion, compared to $6.51 billion during the same period last year. Key exports included mineral fuels, machinery, precious stones, pharmaceuticals, apparel, chemicals, and iron and steel, which together accounted for 68.72% of total exports to the UK. In March 2024, negotiations for the India-UK trade deal were put on hold due to both nations preparing for general elections. Bilateral trade between India and the UK increased from $20.36 billion in FY23 to $21.36 billion in FY24.
While both sides remain optimistic about reaching a fair and equitable deal, several contentious issues must be resolved as they prepare for the next round of talks. In February this year, India’s Prime Minister’s Office reviewed the progress of the India-UK FTA talks, which began on January 13, 2022, and faced delays due to changes in UK leadership. Fourteen rounds of discussions were completed, with 21 out of 26 policy areas finalised by the end of 2023. The agreement covers goods, services, investments, and intellectual property rights.
Amidst a recession and opposition to immigration and outsourcing in the UK, India has sought increased access for IT/ITeS and healthcare professionals under the FTA.
Meanwhile, the UK has requested duty concessions on chocolates, lamb meat, electric vehicles, and scotch whisky, the latter of which is opposed by the Indian alcohol industry. Both countries are also negotiating a bilateral investment treaty (BIT).
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