India aims to launch FTA negotiations with UK by November 1

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India and the United Kingdom are aiming to launching the negotiations on the proposed Free Trade Agreement between the two nations by November 2021. Significantly, a target for March, 2020 has been kept for finalizing the talks and inking a deal.

The decision was taken at a meeting between Commerce and Industry Minister Piyush Goyal and his British counterpart Secretary of State for International Trade Elizabeth Truss on 13 September.

The two sides will look for an interim agreement as a priority, with more comprehensive larger FTA later down the line, the Commerce Department said on 14 September. This 'early harvest' agreement will allow both nations to establish early gains in some select commodities and services.

The latest announcement comes close on the heels of the government deciding to finalize an early harvest trade pact with Australia by 2021-end.

Proposed FTA between India & UK is expected to unlock extra ordinary business opportunities and generate jobs . Both sides have renewed their commitment to boosting trade in a manner which benefits all.

Goyal has said that since the ‘Declaration’ on launch of Enhanced Trade Partnership, announced by Prime Ministers on 4 May 2021, both countries have made substantial progress on various aspects of the partnership.

This includes substantial work in the form of extensive stakeholder consultations have been held involving domestic industry, business associations, export promotion councils, buyers/sellers associations, regulatory bodies, Ministries and public research bodies.

Growing Momentum

Back in May, the UK had launched a 14-week mandator public consultation period on the deal. At a key bilateral digital summit in May that saw the participation of Prime Minister Narendra Modi and British PM Boris Johnson, both nations decided to wrap up trade talks by 2021-end. In a bid to galvanise business ties and investment flows, they had also launched the Enhanced Trade Partnership, of which the trade pact is a part.

At the latest meeting, Goyal said that bilateral working groups (BWGs) for different tracks have been formed to understand ambitions, interests and sensitivities of each other to facilitate accelerated progress during negotiations. The meetings of these BWGs are presently in progress and are likely to be completed by September, 2021.

He said that he was hopeful that these BWG discussions would help both sides in understanding each other’s policy regimes and would put us in a better position when both sides begin their Joint Scoping discussions, beginning on 1st October 2021, for finalizing the Terms of References for launch of negotiations in November.

In discussions on services, certain services of mutual interest may be included in the Interim Agreement through request offer approach wherein we may include priority sectors which are immediately deliverable, the Commerce Department has said.

If necessary, India may also explore signing of few Mutual Recognition Agreements in selective services like nursing and architecture services.
Goyal has repeatedly emphasized upon the need to strike a balance between commitments & concessions in goods and services trade.