India, UK begin FTA talks to double bilateral trade by 2030
– World Affairs SRS
Trade Minister Piyush Goyal and his British counterpart Anne-Marie Trevelyan, who is visiting India, jointly launched talks for an FTA, which is considered India’s deepest trade deal ever.
In a joint statement, the two sides said the first round of talks would begin on January 17 and the next round of talks would be held approximately every five weeks. “During the talks, and on the way to a comprehensive agreement, the two governments will consider the option of an interim agreement that generates early benefits for both countries. The Indian negotiating team will be led by Nidhi Mani Tripathi, Joint Secretary in the Department of Commerce, and the UK negotiating team will be led by Harjinder Kang, Director of India Dialogue at the Department of International Trade.
Trevelyan said both sides aim to make the FTA a future-facing deal, accelerating trade in cutting-edge areas that are reshaping the global economy. “(This includes) sectors such as services, innovation where the UK and India are already world leaders and so we are ideal partners with many British and Indian businesses to push the boundaries of technology from fintech to greentech to automation to artificial working for intelligence,” she said.
Britain is looking for trading partners after Brexit and last month signed its first trade deal with Australia. The UK expects India to sharply cut its 150 per cent basic customs duty on Scotch whiskey under the FTA, opening up the UK’s third largest export market for Scotch whiskey by volume after France and the US. India is expected to benefit from duty reduction in labour-intensive sectors such as textiles, leather, jewellery, besides cereals and pharma products.
Goyal said that there is also a lot of potential for increasing exports in services sectors such as information technology, nursing, education, health care, including AYUSH and audio-visual services.
“India will also demand special arrangements for the movement of its people,” he said.
Commerce Secretary BVR Subrahmanyam said the “new era” FTA will have 16 chapters, including Intellectual Property Rights, Digital Economy, Geographical Indication (GI), Sustainability, Anti-Corruption, Investment and MSMEs.
“The interim agreement is targeted to be completed by Easter (April 17). This would include tariff liberalization in 60-65 per cent of merchandise while the final deal would cover over 90 per cent of items. Of the 160 service lines, 50-60 will be included in the interim agreement while the final agreement will have a much larger scope. Several chapters like Anti Corruption and MSME will be on best effort basis. So there will be no binding commitment,” he said.
Underlining the importance of the proposed agreement, Subrahmanyam said that since India is not part of any regional trade agreement, it is “brilliantly isolated”. “Even if there is a 5-10 per cent tariff loss in a country like the UK, it is enough to wipe out our exports,” he said.
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