India and the United Kingdom (UK) announced resumption of negotiations of the Free Trade Agreement (FTA) that had stalled for over eight months following the elections in both countries.
This was announced on February 24 by Piyush Goyal, Commerce and Industry Minister, and Jonathan Reynolds, Secretary of State for the Department for Business and Trade, United Kingdom, who is in New Delhi.
“Both sides have agreed to resume negotiations towards a balanced, mutually beneficial and a forward-looking deal that delivers mutual growth and builds on the strengths of the two complementary economies. The strengthening of the trading relationship between our two countries has the potential to unlock opportunities for business and consumers across both our nations and build further on our already deep ties,” according to a joint statement on the resumption of India-UK trade negotiations.
The ministers, however, declined to give a timeline as to when the negotiations would be completed, and the FTA would be signed.
“The United Kingdom and India strike a perfect chord, just as Coldplay’s A Sky Full of Stars which lit up the Narendra Modi stadium…” Goyal told reporters, while referring to the British band’s concert in Ahmedabad in late January.
He, however, noted that it’s never too early and never too late to conclude a good agreement. “I think I have consistently maintained in all our trade negotiations over the years that trade agreements are for a long-term future,” Goyal said when asked about the timeline of conclusion of the deal, underlining that the aim is for a robust agreement, which is a win- win for both sides. It’s always good to conclude fast, so we will have speed, but should not haste,” he said.
Reynolds also underlined that the deal is for the long term but highlighted that it is a top priority of the UK government and has full support of the UK Prime Minister Keir Starmer.
Along with the FTA, the countries are also negotiating a bilateral investment treaty as well as a double contribution convention on social security or a totalisation agreement.
The UK Department of Trade and Business had noted that trade ministers from both countries will kickstart negotiations on a modern economic deal with two days of focused discussions.
Bilateral trade between India and the UK stood at $21.34 billion in 2023-24. The UK is the sixth largest investor in India.
Goyal said that immigration has never been a part of the FTA negotiations but several countries where Indian students go for higher education, incentivise their education by giving them a certain period to gain practical experience. This is done through a business visa, he noted.
On issues around agriculture that have been a sensitive point for India as well as other sticking points for the UK, Reynolds expressed hope that a middle ground would be found, and a mutually beneficial deal will be struck.