New Delhi: In a significant move to bolster economic ties, India and the United Kingdom have resumed negotiations on a comprehensive free trade agreement (FTA) in New Delhi. This development comes after a months-long pause, with both nations aiming to triple their bilateral trade from its current $20 billion to potentially $60 billion over the next decade. The talks, which began on January 13, 2022, have gained momentum with the recent meeting between Commerce Minister Piyush Goyal and UK Secretary of State for Business and Trade Jonathan Reynolds.
At the heart of these negotiations is a three-pronged approach, focusing on the FTA, a Bilateral Investment Treaty (BIT), and a Double Contribution Convention Agreement. These agreements are designed to enhance trade, investment, and social security cooperation between the two countries. Mr. Goyal described the potential deal as “pathbreaking,” emphasizing its long-term benefits for both nations. He noted that while speed is crucial, there should be no haste in finalizing the agreement, as it needs to be robust and mutually beneficial.
Mr. Reynolds echoed these sentiments, highlighting the FTA as a top priority for the UK. Both ministers emphasized the importance of creating a balanced and forward-looking deal that leverages the complementary strengths of their economies. The negotiations also touch on sensitive issues such as migration, with Mr. Goyal clarifying that immigration has never been part of trade talks, while Mr. Reynolds welcomed the significant relationship between India and the UK in terms of business mobility.
The bilateral trade between India and the UK has shown steady growth, reaching $21.34 billion in 2023-24, up from $20.36 billion in the previous year. The UK is India’s sixth-largest investor, with significant foreign direct investment (FDI) inflows over the years.
