Commerce and Industry Minister Piyush Goyal has announced his visit to the UK on July 10-11 to assess the progress of the Free Trade Agreement (FTA) negotiations between India and the European Free Trade Association (EFTA). The visit will also involve discussions with ministers from EFTA member countries regarding the Trade and Economic Partnership Agreement (TEPA) progress with EFTA, as confirmed by the commerce ministry.
Committed to expanding economic ties
Both India and the UK are dedicated to expanding their economic ties and exploring opportunities for increased bilateral trade. The aim of this visit is to accelerate the FTA negotiations and facilitate a comprehensive and mutually beneficial agreement that promotes economic growth and strengthens the bond between the two nations.
During the visit, Minister Goyal will engage in high-level meetings with his UK counterparts, including the Secretary of State for International Trade, as well as representatives from various sectors and industries. These meetings will provide a platform to discuss the key priorities and objectives of the FTA negotiations, focusing on addressing trade barriers, promoting investments, and fostering greater cooperation in areas such as technology, innovation, and intellectual property rights.
In addition, the Minister will assess the progress of the TEPA negotiations with EFTA by meeting with ministers and officials from EFTA member countries, namely Switzerland, Norway, Iceland, and Liechtenstein. The TEPA aims to enhance trade and economic cooperation between India and the EFTA member countries, creating an environment conducive to increased investments, reduced trade barriers, and greater market access.
This visit highlights the Indian government’s commitment to actively engage with international partners and seize opportunities for economic growth and development. It reflects a determination to build strong and mutually beneficial trade relationships that benefit the economies of both India and the UK, contributing to the overall prosperity and welfare of their citizens.
India-UK trade agreement
The negotiations for a trade agreement between India and the UK were initiated on January 13, 2021. After completing ten rounds of talks by June, both sides are working towards concluding the negotiations at the earliest.
The negotiations cover 26 policy areas/chapters. Simultaneously, investment is being negotiated as a separate bilateral investment treaty between India and the UK, which will be concluded alongside the free trade agreement.
In the last fiscal year, bilateral trade between the countries amounted to USD 20.36 billion, showcasing an increase from USD 17.5 billion in the previous year. India’s main exports to the UK include ready-made garments and textiles, gems and jewellery, engineering goods, petroleum and petrochemical products, transport equipment, spices, machinery and instruments, pharmaceuticals, and marine products. Key imports from the UK include precious and semi-precious stones, ores and metal scraps, engineering goods, professional instruments (excluding electronics), chemicals, and machinery.
The UK is the largest market in Europe for Indian IT services and one of the leading investors in India. In 2022-23, India received USD 1.74 billion in foreign direct investment from Britain, compared to USD one billion in 2021-22. Total investments from the UK to India amounted to USD 33.9 billion between April 2000 and March 2023.
The Indian government has been in discussions with EFTA to resume negotiations for the agreement. Such agreements facilitate significant reductions or eliminations of customs duties on a wide range of goods traded between trading partners, while also easing norms to promote trade in services and investments. EFTA, made up of countries that are not part of the EU, plays a crucial role in promoting free trade.
India’s exports to EFTA countries during April-February 2022-23 amounted to USD 1.67 billion, slightly lower than USD 1.74 billion in 2021-22. However, imports from EFTA countries totaled USD 15 billion during the 11-month period, down from USD 25.5 billion in 2021-22. The trade gap remains in favor of the EFTA group.
(With PTI inputs)
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Omprakash Tiwary is a business writer who delves into the intricacies of the corporate world. With a focus on finance and economic landscape. He offers readers valuable insights into market trends, entrepreneurship, and economic developments.