India has told its British counterparts that if the negotiations fail at this stage, then it will have to wait till the new government takes charge…reports Asian Lite News
The Centre has told the UK government that the window to finalise the much-awaited India-UK FTA deal will close once the dates of the Lok Sabha elections are announced and the model code of conduct comes into effect. India has told its UK counterparts that if the negotiations fail at this stage, then it will have to wait till the new government takes charge.
A delegation from the UK, headed by Douglas McNeill, the chief economic advisor to British Prime Minister Rishi Sunak, is currently in Delhi to discuss the details.
McNeill has met top officials at the Prime Minister’s Office (PMO), Commerce and Industry Minister Piyush Goyal, Finance Minister Nirmala Sitharaman, Economic Affairs Secretary Ajay Seth and Commerce Secretary Sunil Barthwal to discuss matters related to the proposed free trade agreement (FTA) and an investment treaty.
The trade deal between India and the UK was initiated more than two years ago on January 13, 2022. Despite engaging in 14 rounds of negotiations, both parties have struggled to find common ground on certain contentious matters.
The FTA comprises 26 chapters encompassing goods, services, investments and intellectual property rights. At present, India is trying to seek a resolution on London’s plan to roll out a carbon border tax on its imported goods from 2027 and include the social security agreement.
Most of the work in all the 26 chapters of the proposed India-UK FTA is done, with about 21 almost closed, but there are small niggling issues, involving one or two articles, that are left in some, the source said.
Some of the points of disagreement involve the UK’s request for reduced tariffs on whiskey and automobiles, including electric vehicles. Additionally, the UK is striving to explore further prospects in telecommunications, legal, and financial services within the Indian markets.
Negotiations are now expected to carry on virtually in February, till the start of the model code of conduct. Indian industry is expecting that the FTA will result in increased opportunities for skilled professionals, especially in sectors like information technology and healthcare, to enter the UK market. On the other hand, the UK industry is eager for more efficient business operations and lower import tariffs on products like automobiles, liquor, and confectionery, among other items.
The UK FTA is crucial as it will serve as a template for trade deals with larger western trade partners such as the European Union and European Free Trade Association (EFTA). Economic integration with the western countries through FTA assumes significance as the global supply chain is undergoing a reset after covid-19 and multinational companies globally are adopting a China plus one policy. Multilateral trade agreements such as the Indo-Pacific Economic Framework for Prosperity (IPEF) are also being negotiated in a bid to shift away from dependence on China.
While the UK has asked India to reduce duty on cars and whisky among other items, India has sought better access for its service sector workforce in the UK. The final deal could see India lower duty to a greater extent as India is a high tariff country. The average tariff on goods imported from India into the UK is 4.2% but the average tariff in India on goods imported from the UK is 14.6%
Earlier, urging the UK to shed its “old lenses” and “see India for what it is”, India’s Deputy High Commissioner, Sujit Ghosh, on Wednesday said that London is “uniquely positioned” to benefit from New Delhi’s rise.
Ghosh was addressing the annual UK-India Parliamentary Lunch organised by the London-headquartered India Global Forum (IGF) in London.
The annual event brings together “leading figures from politics, business, finance, and culture over an informative sit-down lunch to celebrate the growing ties between our two great democracies,” according to the IGF website.
Ghosh spoke extensively about the growing UK-India ties, the vibrant digital economy, and opportunities in India, the IGF said in a post on the social media platform X.
He said, “India is not just creating opportunities for its people but also for the rest of the globe. The UK is uniquely positioned to benefit from India’s rise.”
“The time has come for our friends in the UK to shed their old lenses and see India for what it is,” the X post quoted Ghosh.
James Cleverly, UK Home Secretary, was quoted in another post on X by the IGF as saying, “The living bridge between UK and India, the people-to-people links, and the ability for people to visit our respective countries, work together, do deals together, is incredibly important.”
IGF founder Manoj Ladwa highlighted the current geopolitics, trade and investment scenarios and said, “Democracies work best when they work together.”
The IGF is the agenda-setting forum for international businesses and leaders, offering platforms for corporates and policymakers.
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