The United Kingdom and India have reignited trade discussions in Delhi, highlighting sectors such as advanced manufacturing, clean energy, and professional services that could benefit from a free trade agreement. The potential deal promises to unlock significant markets for British exports, including cars, scotch whiskey, and financial services, valued at billions of dollars. This move comes as India actively pursues trade agreements with various countries after years of skepticism regarding such deals.
Since 2022, the UK and India have conducted over a dozen negotiation rounds, yet a final agreement remains elusive. Key issues include India's high tariffs on Scotch whiskey and demands for relaxed fees and visa regulations for Indian students and professionals seeking to work in the UK. India is eager to secure greater mobility for its workforce and students while advocating for expedited visa processing.
Jonathan Reynolds, the UK's business and trade secretary, has prioritized securing a trade deal with India. He arrived in Delhi to engage in two days of discussions with his Indian counterpart, Piyush Goyal. A UK government statement revealed that the two nations currently share a trade relationship worth £41 billion ($52 billion).
India's government, under Prime Minister Narendra Modi, views the UK as a high-priority trading partner. Modi's administration is targeting an ambitious export growth of $1 trillion by FY30. The resumption of talks was announced last November, with high hopes for 2023. Meanwhile, India has successfully signed a $100 billion free trade agreement with the European Free Trade Association after nearly 16 years of negotiations.
As the UK prepares to restart negotiations with the European Union this year, a successful trade agreement with India could unlock new opportunities for both countries. India's economy is forecasted to become the world's third largest in the coming years, adding further incentive for the UK to secure a deal.