India-UK Free Trade Agreement and Related Negotiations
India is actively engaged in negotiations for a Free Trade Agreement (FTA) with the UK, aiming to significantly reduce tariffs and enhance bilateral trade and investments. The discussions include various components such as a Bilateral Investment Treaty (BIT) and a Double Contribution Convention Agreement aimed at social security.
Key Negotiation Areas
- Free Trade Agreement (FTA):
- India is willing to reduce tariffs in the FTA with the UK.
- The goal is to more than double the current bilateral trade in a decade.
- India aims to open up services and economies to attract more investments.
- Bilateral Investment Treaty (BIT):
- Discussions are ongoing, though specific expectations from India's model BIT are yet to be detailed.
- Indian investments in the UK have created around half a million jobs.
- Double Contribution Convention Agreement:
- Aims to prevent double contributions to social security funds for Indian professionals working temporarily in the UK.
- India seeks an attractive social security offer in exchange for service sector concessions.
Additional Negotiation Topics
- Visa Regime:
- India advocates for a more liberal and faster issuance of business visas.
- Business mobility is distinguished from immigration in the discussions.
Trade and Economic Impact
The bilateral trade between India and the UK increased to $21.34 billion in FY24 from $20.36 billion in FY23. The ongoing negotiations aim to enhance business competitiveness by significantly reducing tariffs.
Negotiation Progress
- 14 rounds of negotiations have been conducted so far.
- No specific deadline but a focus on creating a robust, long-term agreement.
Ministerial Statements
Commerce and Industry Minister Piyush Goyal emphasized India's capacity to be flexible in tariff reductions and the focus on a comprehensive agreement that benefits both nations. He highlighted the importance of not rushing to ensure a win-win situation.
