India-UK CETA Integrates Sustainability into FTA Framework with Cooperation-Based Approach

Opinion article examines how the India-UK Comprehensive Economic and Trade Agreement incorporates sustainability provisions while preserving regulatory flexibility.

The India-UK Comprehensive Economic and Trade Agreement (CETA), which came into effect on July 15, includes several provisions on trade and sustainability. In an opinion article, James J Nedumpara and Shiny Pradeep examine how the agreement incorporates environmental, labour and social considerations through cooperation-based mechanisms rather than binding obligations.

Trade agreements have increasingly expanded beyond market access to include provisions covering sustainability, labour, environment and social issues. According to James J Nedumpara and Shiny Pradeep, the India-UK Comprehensive Economic and Trade Agreement (CETA), which entered into force on July 15, reflects this evolving approach by incorporating progressive chapters on trade and sustainability.

The article notes that recent trade agreements have moved beyond conventional provisions on goods and services to address subjects such as labour, environmental protection, gender, anti-corruption and indigenous peoples. While India had previously been cautious about incorporating social clauses into trade agreements, the authors state that international trade policy has increasingly aligned with the broader sustainability agenda, particularly following the adoption of the United Nations Sustainable Development Goals (SDGs) in 2015.

According to the authors, the CETA contains references to 58 international treaties, the majority of which relate to non-core trade issues. These references are intended to reaffirm existing international commitments and provide a framework for implementation and compliance.

The article points out that the agreement does not require India to ratify additional international agreements. It explains that while some advanced economies include obligations to ratify international labour or environmental conventions in their trade agreements, the India-UK CETA does not impose such requirements.

The authors observe that India has ratified six of the 10 fundamental International Labour Organization (ILO) conventions. They note that the remaining conventions include the Freedom of Association and Protection of the Right to Organise Convention, 1948, the Right to Organise and Collective Bargaining Convention, 1949, the Occupational Safety and Health Convention, 1981, and the Promotional Framework for Occupational Safety and Health Convention, 2006. The article also notes that India amended the ILO Declaration on Fundamental Principles and Rights at Work in 2022, which was originally adopted in 1998.

According to the article, labour provisions in the CETA recognise that ratifying international conventions remains a sovereign decision. The sustainability chapter therefore reflects a gradual and incremental approach rather than creating new mandatory commitments.

The article further states that the agreement does not include dispute settlement or sanctions for sustainability-related obligations. Instead, matters relating to labour and environmental provisions are addressed through consultations, with the highest level of recourse being ministerial consultations. The authors note that the outcomes of such consultations remain confidential unless the parties decide otherwise.

Another feature highlighted in the article is the state-level carve-out. The trade and sustainability obligations generally apply to both central and state-level measures, but the agreement excludes sub-federal laws and regulations from the scope of labour and environmental chapters. According to the authors, this preserves regulatory space for state governments while recognising differences in national and sub-national priorities.

The article also discusses the role of civil society, noting that while sustainability chapters in many modern FTAs provide for structured engagement with civil society organisations, the India-UK CETA does not establish such formal engagement mechanisms. Instead, labour and environmental chapters encourage public awareness and procedural safeguards through domestic laws.

The authors conclude that the India-UK CETA adopts a cooperation-based model by introducing broad areas of collaboration to support sustainable development objectives while maintaining regulatory flexibility. According to the article, the agreement balances environmental and labour standards with national policy priorities by excluding dispute settlement provisions from sustainability obligations and limiting their application to Union-level measures.