Representatives of the Indian and British government ended the first day of discussions over a potential free trade agreement in New Delhi.
The goal is to sign a deal before the end of the year that will increase trade and commerce between the two countries by billions of pounds.
Piyush Goyal, India’s trade minister, and Anne-Marie Trevelyan, the UK’s trade minister, both predicted a limited agreement might be reached in the coming months.
For the UK government, striking a post-Brexit trade deal with India is one of its top goals as the government under Prime Minister Boris Jonson seeks to tap into fast-growing economies.
“This is an opportunity that we must seize to steer our partnership along the track of mutual prosperity for the decades to come,” Trevelyan said.
According to the United Kingdom, the agreement may nearly double British exports to India and increase total commerce between the two countries by £28 billion per year by 2035. In 2019, total trade was worth £23 billion.
The trade talks with India are not for the faint of heart.
However, with no progress on a free trade agreement with the United States and none expected in the near future, the formal start of discussions with India, announced in New Delhi on Thursday, is the most significant negotiation the UK government will undertake this year.
India is on track to become the world’s third largest economy by 2050, and the government expects UK-India commerce to quadruple in the next decade.
The prospect of a free trade agreement with India is described by Trade Secretary Anne-Marie Trevelyan as a “great chance,” and there are undoubtedly significant commercial benefits at stake.
India, on the other hand, has always been hesitant to liberalise because it has so many vested and vulnerable interests to defend.
The EU has been attempting to establish a genuine agreement with India for years, but has had little luck. For a decade, Australia has been working on a deal as well.
Particularly problematic areas include government procurement policies and service trade.
India wants additional chances for Indians to live and work in the United Kingdom, and any trade agreement might include discussions about loosening laws and decreasing prices for Indian students and professionals visiting the United Kingdom.
However, Goyal stated that such difficulties will not be a stumbling block to a trade agreement between the two countries.
“Nothing is necessarily a deal-breaker in this agreement,” Goyal said. “And I will not think there is any way for anybody to worry about issues which are sensitive to any country, because both sides have agreed that sensitive issues are not our priority,” he added.
Ministers in the United Kingdom want British companies to be able to sell more items to India, such as whisky.
They also want India to become a larger purchaser of British green technology and services.
(Adapted from BBC.com)