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What is the News?
India and the UK are planning to begin the negotiations on a Free Trade Agreement(FTA) by November 2021.
About India-UK FTA
India and the UK are planning to sign an interim trade deal by March 2022 which will be followed by a comprehensive Free Trade Agreement(FTA).
The interim trade pact would involve early tariff or market access concessions on certain key ‘high priority products and services.
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What are the key expectations linked with India-UK FTA?
Under this, the UK would expect India to bring down tariffs on certain key UK export items such as food and drinks (including scotch and whiskey), automotive, chemicals and life sciences (including pharmaceuticals and medical devices).
On the other hand, India would expect greater market access for its engineering and auto components, readymade garments, gems and jewellery, food and agricultural products.
Non-tariff and technical barriers
Under this, India would expect the UK to be relatively more flexible with respect to the WTO-plus sanitary and phytosanitary requirements (food safety, animal and plant health standards) as applied by it on Indian food, agricultural and marine products.
The UK on the other hand would expect India to remove sectoral, non-tariff and technical barriers. In addition, the UK would also expect India to strengthen its Intellectual Property(IP) regime.
Trade in Services:
The UK is likely to focus on a more liberal Mode 3 access (cross-border investment and commercial presence) for information, communications and technology (ICT), educational, financial, telecom, travel, retail and energy related services.
On the other hand, India has a greater comparative advantage in professional and computer-related services. Hence, it is likely to seek a more liberal Mode 4 access (movement and presence of professionals and students).
Source: This post is based on the article “India, UK aim to launch FTA negotiations by November 1” published in PIB on 14th September 2021.