What is the News?
India and the UK will start active consultation to finalize a Free Trade Agreement (FTA).
|Must Read: What is a Free Trade Agreement(FTA)|
Why is the FTA with the UK important for India?
India-UK FTA will be critical for India at a time when the country has walked out of key FTAs such as the Regional Comprehensive Economic Partnership(RCEP).
Moreover, India has rolled out an aggressive Atmanirbhar Bharat plan, which aims to make it an export powerhouse with $1 trillion exports by 2030. So fewer trade barriers with the UK could give a push to exporters.
|Read more: India, UK aim to launch FTA negotiations by November 1|
What does India-UK want in the FTA?
India: It wants enhanced mobility for its professionals and a reduced fee for work and tourism visas, safeguards for agriculture, better market access for vaccines, basmati rice, wool, yarn, instant coffee and tea premix among others.
UK: It wants the ease of doing business, removal of tariffs of up to 150% on whisky and 125% on British-made cars. Also, removal of barriers to trade in services, food and drink, healthcare and medical devices.
What are India’s views on Multilateral Trade?
India remains committed to trade multilateralism, with the World Trade Organisation (WTO) at its centre.
It has also renewed its efforts to strike bilateral trade deals with key countries. India believes exports could be further strengthened through an extensive set of preferential trade agreements.
Further, more FTAs will give Indian products more access to global markets and the opportunity that India missed by staying out from the RCEP.
What about India’s FTA with other countries?
India is close to finalizing one FTA with the United Arab Emirates (UAE). Talks are at an advanced stage with Australia on an interim agreement.
India is also in negotiations with Israel and hopes to launch discussions with Canada on the same in two or three months.
Source: This post is based on the article “Things to watch for as India, UK launch FTA talks” published in Livemint on 11th January 2022.