In a significant development for the global textile industry, India and the United Kingdom have agreed to resume negotiations on a Free Trade Agreement (FTA) in early 2025. The decision was made following a bilateral meeting between Prime Minister Narendra Modi and UK Prime Minister Keir Starmer on the sidelines of the G20 Summit in Rio de Janeiro.
The FTA talks, which were originally launched in early 2022, had been halted earlier this year due to general elections in both countries. Despite 14 rounds of negotiations under three previous British Prime Ministers, a definitive agreement remained elusive.
The resumption of talks is expected to focus on building upon the progress achieved in previous rounds and addressing outstanding issues to expedite the conclusion of the trade deal. The UK is a crucial market for Indian textile exports, with a significant share in the country’s overall export basket.
Key Points:
- Textile Industry Implications: The FTA is anticipated to boost bilateral trade in textiles and apparel, streamlining customs procedures, reducing tariffs, and creating new opportunities for Indian exporters.
- Market Access: The UK market offers a gateway to European consumers, and an FTA could provide Indian textile manufacturers with preferential access to this lucrative market.
- Investment Opportunities: The agreement could also attract investments from UK textile companies into India, leading to technology transfer, job creation, and skill development.
- Supply Chain Diversification: For the UK, an FTA with India could offer a strategic opportunity to diversify its supply chains and reduce reliance on specific regions.
Both countries have expressed optimism about the potential benefits of the FTA, and industry stakeholders are closely watching the developments as they could have a profound impact on the global textile landscape.
