NEW DELHI: In a recent development on the global trade front, India and the United Kingdom are on the cusp of signing a groundbreaking Free Trade Agreement (FTA) by the close of October 2023, as revealed in a recent report. This agreement marks a significant stride in fortifying the bilateral economic relationship between the two nations.

British Prime Minister Rishi Sunak has reiterated his unwavering commitment to fostering closer ties between India and the UK, encompassing a comprehensive FTA that encompasses various sectors. These affirmations from the British Prime Minister reflect the enthusiasm on both sides to boost economic collaboration.

Official data from the UK Department for Business and Trade (DBT) underscores the substantial financial implications of this agreement. The figures reveal that bilateral trade between the UK and India reached an estimated 36 billion pounds in 2022, underscoring the importance of this economic partnership.

A pivotal step in the lead-up to the FTA signing, a 30-member official UK delegation commenced the latest round of negotiations with the Indian team, seeking to address outstanding issues and expedite the conclusion of talks. The objective is to pave the way for the impending FTA agreement, as confirmed by an official source.

Recent reports indicate that both nations have successfully wrapped up the 13th round of negotiations. A delegation led by India's Commerce Secretary, Sunil Barthwal, was present in London last week, infusing fresh momentum into the discussions. One critical aspect that was underscored during the talks is the 'rules of origin' provision.

The 'rules of origin' stipulation dictates that minimal processing should occur in the FTA partner country, ensuring that the final manufactured product can be categorized as originating from that nation. This provision serves as a safeguard against the entry of goods from a third country into the Indian market, merely through rebranding. Instead, any goods intended for export to India under this agreement must undergo a prescribed level of value addition. This norm is designed to mitigate the risk of foreign goods flooding the Indian market.

In parallel with the FTA discussions, an investment treaty is also being negotiated separately between India and the UK. This treaty underscores the multifaceted approach both nations are taking to fortify their economic ties.

This ongoing endeavor follows discussions earlier this year, during which UK's Trade Minister Kemi Badenoch reviewed the progress of the trade negotiations with her Indian counterpart, Commerce and Industry Minister Piyush Goyal. These discussions occurred during a visit to India in August, coinciding with the 12th round of FTA negotiations. The bilateral trade figures for India and the UK underscored the growth of their economic relations, as trade surged from USD 17.5 billion in 2021-22 to USD 20.36 billion in 2022-23.

With the imminent signing of the Free Trade Agreement on the horizon, India and the United Kingdom are poised to usher in a new era of economic cooperation, further solidifying their robust partnership in the global economic landscape.

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