Published 23:02 IST, July 24th 2020
India, UK chalk out Enhanced Trade Partnership with eye on Free Trade Agreement
India & UK are eyeing a Free Trade Agreement (FTA) and have worked out an Enhanced Trade Partnership as the first step on a wider roadmap for deeper trade ties
India and the United Kingdom are eyeing a Free Trade Agreement (FTA) and have worked out an 'Enhanced Trade Partnership' as the first step on a wider roadmap for a deeper trade partnership.
The UK’s International Trade Secretary Liz Truss and Union Commerce Minister Piyush Goyal on Friday participated in the 14th Joint Economic and Trade Committee (JETCO) which is a cabinet-level summit to discuss commercial ties.
Both countries agreed to develop a deeper trading relationship and subject to progress, this could lead to a future Free Trade Agreement, the British Department for International Trade said in a statement after the meeting. "This will include an Enhanced Trade Partnership as the first step on a wider roadmap for a deeper trade partnership, and subject to progress could lead to a future Free Trade Agreement," it added.
The two sides agreed to work towards removing additional barriers, and to work together to ensure both countries maximise the potential of their digital economies including on data regulation and interoperability.
Britain, which left the European Union (EU) earlier this year, is keen to bolster economic ties with India and cement commercial relations as it will no longer be bound by EU trade rules and will have the power to sign bilateral trade deals. India-UK trade was worth £24 billion last year, and India is now the second-largest investor in the British economy
The UK’s International Trade Minister Ranil Jayawardena has raised the ambition to remove barriers for businesses across a range of sectors including food and drink, healthcare and life sciences, IT and data, chemicals, and services.
Work has been underway to reduce barriers to trade since both countries completed a Joint Trade Review in 2018. The British side noted that the UK’s new Global Tariff (UKGT), which comes into force on January 1 next year, serves as a ‘building block’ towards an increasingly open trade partnership and could boost trade flows by reducing tariffs on Indian exports by up to £40m per year.
Powerhouse in shaping the 21st Century
Noting India as an incredibly important partner for the UK, Truss said the world’s largest economies and democracies are a powerhouse that will play a major role in shaping the 21st Century. "Today we agreed to look in detail at a framework for a deeper relationship. At this stage, we want to keep all options on the table, including the possibility of a free trade agreement at some point in the future," she said.
Meanwhile, Ranil Jayawardena emphasized the need to knock down existing trade barriers, create more good jobs, and encourage innovation between India and Britain. He also led a business plenary during the JETCO, organised by the UK India Business Council (UKIBC).
The UK is the second-fastest-growing G20 investor in India over the past 10 years, investing more than £22 billion and helping create more than 422,000 jobs. India is currently the second-biggest investor in the UK, with 120 new projects and more than 5,000 new jobs in 2019-20.
Updated 23:03 IST, July 24th 2020