UK Experts Indicate India-UK Free Trade Agreement Completion Imminent

Experts in trade and industry from the UK have indicated that the India-UK Free Trade Agreement (FTA) is nearing completion. This follows significant advancements made during Commerce and Industry Minister Piyush Goyal's visit to the UK. As Goyal returned to London after a European tour, optimism grew that the remaining negotiation issues would soon be resolved.

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The Lord Mayor of London hosted an "Indian Century" dinner at Mansion House, expressing optimism about the FTA to senior executives and stakeholders. Alderman Alaistair King, the ambassador for London's financial hub, stated, "We welcome the progress that is being made on securing a Free Trade Agreement between our nations... progress driven forward by Commerce Minster Piyush Goyal’s visit to London this week."

India-UK Trade Relations

Last year, the trading relationship between India and the UK was valued at GBP 42 billion, supporting over 600,000 jobs. India has become the UK's fastest-growing export market for services, with trade increasing by over 260% in the past decade. The dinner also featured remarks from Vikram Doraiswami, India's High Commissioner to the UK, and Lord Karan Bilimoria, co-chair of the India All Party Parliamentary Group (APPG).

Lord Karan Bilimoria expressed confidence in the imminent announcement of the trade deal. He believes bilateral trade could double to GBP 80 billion within five years once the FTA is signed. As a long-time advocate for closer India-UK ties, Bilimoria emphasised the importance of both countries leading in digital trade and supporting a multilateral rules-based system amid global challenges.

Key Negotiation Points

Earlier this week, Goyal engaged in discussions with UK Business and Trade Secretary Jonathan Reynolds and Chancellor Rachel Reeves to advance the FTA. The agreement aims to significantly reduce customs duties on goods traded between the two nations and ease norms for promoting trade in services and bilateral investments.

The Indian side seeks greater access for its skilled professionals, while the UK desires substantial reductions in import duties and more opportunities for its services sector. "Indian tariffs on items like Scottish whisky are far too high and need to come down; the hope is that the 150 per cent will come down to something like 50 per cent," said Bilimoria.

Final Stages of Negotiations

Bilimoria has been monitoring the deal since its launch under the previous Conservative Party government in January 2022 and its relaunch by Keir Starmer's Labour administration in February. He highlighted concerns about Indian workers paying taxes in the UK without benefiting when returning to India. "These things are all resolvable," he added.

Reports indicate that nearly all of the 26 chapters of the agreement are now closed, leaving only final hurdles around some tax-related matters. The anticipation is high for a favourable outcome that benefits both sides.

The ongoing discussions reflect a shared commitment to strengthening economic ties between India and the UK. As negotiations approach their conclusion, both nations look forward to enhanced trade relations that promise mutual growth and prosperity.

With inputs from PTI