The Indian industry is demanding greater access for its skilled professionals from sectors like IT and healthcare in the UK market, besides market access for several goods at nil customs duty…reports Asian Lite News
India and the UK are expected to hold the next round of talks for a proposed free trade agreement in October to resolve the pending issues and close the negotiations, a senior official said on Tuesday.
India’s Commerce Secretary Sunil Barthwal said the officials of the UK are briefing their new ministers about the proposed free trade agreement (FTA). The two sides have already taken stock of the progress of talks at secretary and minister levels.
“The briefings are going on in the UK…they are briefing their new ministers and based on that, the negotiations will start. We are hoping that in October, the negotiations should resume,” Barthwal said.
He also said India is progressing on all FTAs, but there are certain things which are not in control of anyone. The India-UK talks for the proposed FTA began in January 2022. The 14th round of talks stalled as the two nations stepped into their general election cycles.
The Indian industry is demanding greater access for its skilled professionals from sectors like IT and healthcare in the UK market, besides market access for several goods at nil customs duty.
On the other hand, the UK is seeking a significant cut in import duties on goods such as scotch whiskey, electric vehicles, lamb meat, chocolates and certain confectionary items.
Britain is also looking for more opportunities for UK services in Indian markets in segments like telecommunications, legal and financial services (banking and insurance).
The two countries are also negotiating a bilateral investment treaty (BIT).
There are 26 chapters in the agreement, which includes goods, services, investments and intellectual property rights.
The bilateral trade between India and the UK increased to USD 21.34 billion in 2023-24 from 20.36 billion in 2022-23.
The Labour Party’s election manifesto for the recent polls also committed to clinching the deal.
A virtual meeting between Commerce and Industry Minister Piyush Goyal and Jonathan Reynolds, UK Secretary of State for Business and Trade was held on July 11 to discuss next steps on the pact.
Talking about the trade agreement with Australia, the secretary said that the two sides are looking at ways to conclude the negotiations before December.
He added that chief negotiators of both the sides are meeting on the pact, besides the trade ministers.
India and Australia implemented an interim pact, officially dubbed as Economic Cooperation and Trade Agreement (ECTA) in December 2022 and now are in negotiations to expand its scope.
He added that FTAs are long-term negotiations as these are comprehensive in nature involving over 20 chapters.
“They are time-taking. But I must say that we are moving forward on all our FTAs except Canada. We had paused (that). All other FTAs are progressing very well,” he said.
The bilateral trade has dipped to USD 24 billion in 2023-24, from about USD 26 billion in 2022-23.
On India-Bangladesh proposed Comprehensive Economic Partnership Agreement (CEPA), the secretary said there are some problems in the neighbouring country as of now.
“So we are waiting and watching and we will look at it,” he said.
The bilateral trade declined to USD 12.91 billion in 2023-24, from about USD 14.23 billion in 2022-23.
CEPA is a kind of free trade agreement, under which two trading partners significantly reduce or eliminate customs duties on the maximum number of goods traded between them. Besides, they ease norms to promote trade in services and investments.
Further, the commerce ministry informed that the ninth round of negotiations between India and the European Union (EU) for a proposed FTA is planned for September 23-27 here.
During this round, both sides will discuss core tarde issues covering goods, services, investment and government procurement along with necessary rules such as rules of origin, SPS (sanitary and phytosanitary), and technical barriers to trade.
“Also, the concerns of Indian stakeholders regarding the EU’s sustainability measures, such as CBAM, deforestation and others, will be discussed with the EU,” the ministry said.
The Carbon Border Adjustment Mechanism (CBAM) or carbon tax (a kind of import duty) will come into effect from January 1, 2026. It will initially be imposed on seven carbon-intensive sectors, including steel, cement, fertiliser, aluminium and hydrocarbon products.
According to think tank Global Trade Research Initiative (GTRI), the European Union’s Deforestation Regulation (EUDR) would hit India’s agricultural exports worth USD 1.3 billion to the EU starting December 2024.
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