London: The fourteenth round of discussions for a free trade agreement (FTA) between India and the UK wrapped up on Friday. This came just before the anticipated announcement of the general election schedule by the Election Commission on Saturday.
UK officials familiar with the talks expected this pause, as India gears up for election campaigning. They mentioned that formal trade talks will resume only after the Lok Sabha polls are over.
These negotiations, which began in January 2022, aim to achieve a significant boost in bilateral trade. Currently, trade between the two countries stands at approximately GBP 38.1 billion annually, as per recent official figures.
"We anticipate further talks between rounds, but the next formal negotiations will likely happen after the Indian elections," stated sources from the UK.
Both sides affirm their commitment to the negotiations. However, they acknowledge that more work is needed to finalize a deal beneficial for both parties across various sectors including goods, services, and investment.
This development follows a recent phone call between Prime Minister Narendra Modi and UK counterpart Rishi Sunak, where they reiterated their dedication to securing an extensive trade deal.
"We are working towards a comprehensive trade agreement. We are committed to a deal that is fair and beneficial for both the UK and India," said a spokesperson from the UK Department of Business and Trade.
In a recent interview, India's Commerce and Industry Minister Piyush Goyal emphasized the importance of securing long-term benefits for the economy through such agreements.
Meanwhile, Kemi Badenoch, the UK's Secretary of State for Business and Trade, highlighted the complexities of negotiating with a large and diverse economy like India's.
"Negotiating with India, given its size and complexity, presents challenges. India maintains protectionist policies, whereas the UK is more liberalized," Badenoch noted.
One of the key sticking points in the negotiations is the disparity in tariffs. The UK seeks significant reductions in tariffs on its exports to India, including items like food, cars, and whisky, which can currently face tariffs as high as 150 percent. On the other hand, India is concerned about the treatment of its workers temporarily transferred to the UK, who are required to pay national insurance without being eligible for UK pensions or social security benefits.
With both sides committed to reaching a mutually beneficial agreement, the negotiations are expected to resume post the Lok Sabha elections, with hopes of securing a historic deal.
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