British delegation will start next round of India-UK FTA talks Today

In a significant development, a 30-member official delegation from the UK is set to commence the next round of negotiations for a Free Trade Agreement (FTA) with India.

As both nations concluded the 13th round of talks recently, efforts are underway to finalize the outstanding issues, with a focus on rules of origin. Commerce Secretary Sunil Barthwal led a team to London last week, bolstering the momentum of discussions.

Key Negotiation Points:

Rules of Origin and Bilateral Investment Treaty The primary focus of the negotiations is to address critical issues such as rules of origin, a pivotal provision ensuring that the final manufactured product is recognized as originating from the FTA country. This mechanism plays a crucial role in preventing the dumping of goods in the Indian market, requiring a prescribed value addition in the FTA country.

Simultaneously, progress is being made on the proposed Bilateral Investment Treaty (BIT), negotiated separately between India and the UK. The main point of contention revolves around the dispute settlement mechanism, with India proposing the utilization of local judicial remedies before resorting to international arbitration.

Duty Concessions and Automobile Sector Consultations

To facilitate duty concessions in the automobile sector, extensive consultations have taken place with domestic players in India. Notably, discussions involve UK-based automakers such as JLR, Bentley, Rolls-Royce, and Aston Martin, catering to the luxury segment, while Indian manufacturers dominate the mass segment.

India's Industry Demands and UK's Import Duty Requests

The Indian industry is advocating for increased access for skilled professionals, particularly in IT and healthcare, in the UK market. Furthermore, India seeks market access for various goods with nil customs duties. On the flip side, the UK is pursuing reduced import duties on goods like Scotch whiskey, automobiles, lamb meat, chocolates, and certain confectionery items.

Trade Dynamics and Market Opportunities

Britain aims for expanded opportunities for UK services in Indian markets, including telecommunications, legal, and financial services. The Confederation of Indian Alcoholic Beverage Companies (CIABC) emphasizes potential duty reductions for Scotland Whiskey, urging a phased approach for both bottled and bulk imports.

Bilateral Trade Figures and Growth

The bilateral trade between India and the UK witnessed a notable increase, reaching USD 20.36 billion in 2022-23, up from USD 17.5 billion in 2021-22. This underscores the growing economic collaboration between the two nations.

Scotch Whiskey Dominance and Evolving Market Trends

India, replacing France, emerged as the leading buyer of Scotch whiskey by volume in 2022. The Indian alcoholic beverage market, valued at USD 52 billion, continues to shape global trends.

Relevant and latest facts for the news article on the next round of India-UK FTA talks:

• The India-UK FTA is expected to be a comprehensive agreement that will cover a wide range of areas, including goods, services, investment, and intellectual property.

• The two countries have already set a target of concluding the talks by the end of 2023.

• The FTA is expected to boost bilateral trade between the two countries by up to 28% over the next five years.

• It is also expected to create new jobs and investment opportunities in both countries.

• Some of the key sticking points in the talks include rules of origin, market access, and intellectual property rights.

• India is demanding greater market access for its goods and services in the UK market, while the UK is seeking lower tariffs on its exports to India.

• Both sides are also trying to agree on a mechanism for the settlement of disputes.

Latest facts on India-UK trade and investment:

• The UK is India's fifth-largest trading partner and the third-largest source of foreign direct investment (FDI).

• India is the UK's 15th-largest trading partner and the second-largest destination for UK FDI outside of Europe.

• In 2022-23, bilateral trade between India and the UK increased to USD 20.36 billion from USD 17.5 billion in the previous year.

• The UK has invested over USD 40 billion in India in the last decade.

• Indian companies have also invested heavily in the UK, with investments totaling over USD 10 billion in the last decade.

The India-UK FTA is a significant trade deal that has the potential to boost bilateral trade and investment significantly. Both sides are eager to conclude the talks as soon as possible, and the next round of negotiations is expected to be crucial in bridging the remaining differences.