The upcoming round of negotiations for the potential free trade agreement between India and the UK is expected to witness discussions between the chief negotiators. Their primary objective will be to tackle the divergences about crucial matters such as the automotive industry, medical devices, and the mobility of skilled individuals. An official, who preferred to remain anonymous, stated that the UK team may visit India for the 14th round of negotiations to reach a timely conclusion.
While virtual sessions have been making progress, both sides are planning a comprehensive round of talks to cover all chapters. Approximately 60-70 sessions will be held concurrently, according to the official. Issues requiring resolution include rules of origin, intellectual property rights, social security agreements, and duty concessions on electric vehicles, scotch whiskey, lamb meat, chocolates, and certain confectionery items. Additionally, discussions are progressing regarding the proposed bilateral investment treaty (BIT), with the main focus being the dispute settlement mechanism.
The trade talks initially commenced in January 2022, to conclude negotiations by Diwali (October 24, 2022). Nonetheless, as a result of political advancements in the United Kingdom, the set timeframe for completion was not met. The arrangement itself encompasses a total of 26 sections encompassing various aspects such as merchandise, services, investments, and the protection of intellectual property rights.
The Indian industry is advocating for increased market access for skilled professionals, particularly from IT and healthcare sectors, in the UK market. Simultaneously, the UK is seeking significant reductions in import duties on goods such as scotch whiskey, automobiles, lamb meat, chocolates, and certain confectionery items. Great emphasis is also being placed on securing more opportunities for UK services in various segments of the Indian market, including telecommunications, legal services, and financial services such as banking and insurance.
In the fiscal year 2022-23, bilateral trade between India and the UK rose to $20.36 billion from $17.5 billion the previous year. To prevent the dumping of goods, the “rules of origin” provision stipulates that a certain level of manufacturing must occur within the FTA country. This ensures that products labelled as originating goods have undergone the required value addition in that country before being exported to India.
The next round of talks holds the promise of bringing both countries closer to a beneficial free trade agreement, boosting trade and investment opportunities between the two nations.
