India-UK Free Trade Agreement (FTA) Discussions
India and the United Kingdom are set to resume discussions on the proposed Free Trade Agreement (FTA) from February 24, with Douglas Alexander, Britain's trade minister, visiting New Delhi later this month.
Key Objectives and Issues
- The main focus is to settle differences concerning tariff concessions on:
- Electric vehicles
- Alcoholic beverages
- Services
History and Background
- The previous round of negotiations took place in March 2024, and this upcoming session marks the 14th round of discussions.
- In November of the previous year, Indian Prime Minister Narendra Modi and UK Prime Minister Keir Starmer agreed to resume FTA negotiations during the G-20 Summit.
Bilateral Trade Statistics
- Bilateral trade between India and the UK increased to $21.34 billion in FY24 from $20.36 billion in FY23.
Demands and Expectations
- Indian Industry:
- Seeks greater access for skilled professionals in sectors like IT and healthcare in the UK market.
- UK Demands:
- Significant reduction in import duties on goods like Scotch whisky, automobiles including EVs, and chocolates.
- Opportunities for British companies in India's services sectors, including telecommunications, and financial and legal services such as banking and insurance.
Insurance Sector Negotiations
- Negotiations regarding the insurance sector are crucial since India has proposed increasing the foreign direct investment limit from 74% to 100%.
