After years of negotiations, India and the United Kingdom have finalized a comprehensive Free Trade Agreement (FTA) aimed at enhancing bilateral trade and investment. The agreement encompasses 26 chapters covering goods, services, investments, and intellectual property rights. Republic Biz+2Financial Express+2Republic Biz+2
Key Provisions:
Tariff Reductions: India has agreed to reduce tariffs on British automobiles and Scotch whisky. For instance, import duties on Scotch whisky are set to decrease from 150% to 100%, with further reductions planned over the next decade. India Briefing+1Financial Express+1Financial Express+1India Briefing+1
Market Access: The UK will gain greater access to India's markets in sectors such as electric vehicles, lamb meat, chocolates, and confectionery. Conversely, India will benefit from improved access to the UK's service sectors, including IT and healthcare. Outlook Business+3Republic Biz+3ETCFO.com+3Financial Express
Services and Mobility: The agreement includes provisions to facilitate the movement of skilled professionals between the two countries, addressing India's demand for easier visa regimes for its workforce. Republic Biz+2Business Standard+2Financial Express+2
Investment Protections: A Bilateral Investment Treaty (BIT) is being negotiated alongside the FTA to provide a framework for protecting investments and resolving disputes. Financial Express+4Republic Biz+4Republic Biz+4
Social Security Agreement: India and the UK are working towards a social security agreement to prevent double contributions for workers posted in each other's countries. Outlook Business+1Business Standard+1
The FTA is expected to significantly boost trade between the two nations, which stood at $21.34 billion in 2023-24. It also marks a strategic move for India as it seeks to strengthen economic ties with key global partners post-Brexit