India UK FTA

 

India and UK Launch Free Trade Agreement Negotiations

 

Proposed FTA expected to help double bilateral trade by 2030

 

Context:

  • The Minister of Commerce and Industry, Consumer Affairs, Food and Public Distribution and Textiles, Shri Piyush Goyal launched the Free Trade Agreement negotiations with the United Kingdom along with Rt. Hon. Anne-Marie Trevelyan, UK Secretary of State for International Trade in New Delhi today.
  • The FTA is expected to facilitate the target of doubling bilateral trade between India and United Kingdom by 2030, set by the Prime Ministers of both the nations, Shri Narendra Modi and Mr. Boris Johnson in May 2021.

 

India-UK Trade:

  • India has had strong historical ties with the U.K. and currently, it is one of India’s most important trading partners.
  • It is a significant partner of India as an FDI investor after Mauritius and Singapore which ranked second and first respectively.
  • The bilateral trade between the two countries stood at 15.5 billion USD in 2019-20 as against 16.87 USD billion in 2018-19.
  • India has engagement with the UK in sectors like pharma, textiles, leather, industrial machinery, furniture, and toys.
  • India is also looking to the UK to support it with technology based products such as high quality cameras, medical devices, and automobiles.
Significance:
  • Brexit: The UK has been pushing India for a bilateral trading arrangement ever since it voted to leave the European Union (EU) in June 2016 and left finally in January 2020.
  • Exit from RCEP: India opted out of the Regional Comprehensive Economic Partnership deal in November 2019.
  • Therefore, there is renewed focus on trade deals with the US, the European Union and the UK, which are key markets for Indian exporters and are keen to diversify their sourcing.
  • Strategic Partner: The UK is a permanent member of the UN Security Council, and one of the strategic partners of India.
  • Strengthening bonds with the trade would seek UKs support at global issues like standoff with China in the Ladakh sector of the Line of Actual Control (LAC) and claim for permanent seat at UNSC.

Source: THE HINDU.

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