India-UK FTA announced
GS Paper - 2 (International Relations)
The UK government on 13 January 2022 announced the launch of free trade agreement (FTA) negotiations with India, describing it as a "golden opportunity" to put British businesses at the "front of the queue" of the Indian economy.
- The British said an FTA would take the country's historic partnership with India to the next level, and highlighted Scotch whisky, financial services and cutting-edge renewable technology among some of the key sectors set to benefit.
- An India-UK FTA is billed in the UK as creating huge benefits for both countries, with the potential to boost bilateral trade by up to GBP 28 billion a year by 2035 and increase wages by up to GBP 3 billion across the UK.
- The Department for International Trade (DIT) has said the UK wants an agreement that slashes barriers to doing business and trading with India's GBP 2 trillion economy and market of 1.4 billion consumers, including cutting tariffs on exports of British-made cars and Scotch whisky.
- The Indian government's plans to install 175 GW of renewable energy capacity by 2022 are also seen as a major opportunity for the UK's renewables industry, which hopes to benefit from a deal that slashes barriers such as import tariffs as high as 15 per cent on wind turbine parts.
- The UK is pitching the India FTA as a major move since its exit from the European Union (EU), in support of free and fair trade in the Indo-Pacific.
- The launch of similar negotiations with Canada, Mexico and the Gulf are in the pipeline, besides membership of the GBP 8.4 trillion Comprehensive and Progressive Agreement for Trans-Pacific Partnership trade bloc.