While India has already begun bilateral discussions regarding the proposed Free Trade Agreements with the European Union (EU) and the United Kingdom (UK), the government will begin formal negotiations in the next few years.
"For the UK, it will be close to the end of the year. Negotiations with the EU may begin even before that," Commerce Secretary Anup Wadhawan said on June 3.
With FTA talks generally covering intense discussion over tariffs on thousands of products and a wide list of services, formal negotiations usually begin with offers from both sides and are usually held after that.
From import duties on high-value British goods such as automobile and alcohol and immigration access for Indian nationals to the UK, to strict European data protection norms and investment facilitation for firms from the continent, India has a large number of contentious issues to discuss with both parties.
"A lot of preparatory work needs to be done. They will be a bit elaborate since negotiations are starting for the first time. It's the same with the EU since there was a long disruption in talks," Wadhawan said. However, both talks are still set to take place under an 'expedited timeframe', he stressed.
At a key bilateral digital summit earlier this month, both nations decided to wrap up trade talks by 2021-end. In a bid to galvanise business ties and investment flows, both nations also launched the Enhanced Trade Partnership, of which the trade pact is a part.
Expected to be politically significant for Prime Minister Boris Johnson, London hopes to convince British citizens that it will end the contentious high import duties placed on key British goods when sold in India.
On May 25, the UK launched the 14-week mandatory public consultation period on the proposed trade deal with India.
Earlier in May, India and the EU announced the resumption of FTA talks eight years after its suspension, agreeing to launch negotiations for two key pacts on investment protection and geographical indications.
Expanding existing deals
"Wide-ranging efforts to review existing FTAs are also underway, especially those with the Association of Southeast Asian Nations (Asean) bloc, South Korea and Japan, where it is felt India can perform much better," the official said.
The government has also begun talks to upgrade other existing trade deals which have not seen much work despite multiple announcements till now. This includes work on expanding India's existing preferential trade agreements with Chile and South American trading bloc MERCOSUR, and the general trade agreement with Peru, Wadhawan said. Discussions on a deal with Israel are also ongoing, he hinted.
Wadhawan also said that given the encouraging early signs, the government expects exports to scale the $ 400 billion mark in 2021-22. India's cumulative exports in 2020-21 are now expected to be $290.63 billion, down from $314 billion in the previous financial year.