“UK-India FTA valued at GBP 36 billion possible before elections” UK Trade Secy
UK's priorities include reducing tariffs on UK exports such as food, cars, and whisky, which are as high as 150 percent
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Hyderabad: UK Secretary of State for Business and Trade Kemi Badenoch has stated that a trade deal with India is "possible" to be concluded before the upcoming general election in the country. However, Badenoch emphasized that the UK does not wish to impose this as a deadline for the negotiations.
Badenoch, responsible for finalizing the free trade agreement (FTA) currently in its 14th round of talks, highlighted India's "protectionist economy" in contrast to the UK's liberalized regime as a key factor in the prolonged discussions. Speaking at a Global Trade conference at Chatham House, she stressed the importance of achieving a "commercially meaningful" pact rather than just an electoral gesture.
"India is still very protectionist where we are very, very liberalized," remarked Badenoch. "I am not interested in just taking a picture and moving on. It has to be something that is commercially meaningful. People need to be able to say ‘ah now I can do this' like we had with our Australia agreement or with Japan for example," she explained, referencing FTAs with these major economies.
Regarding the timeline for concluding negotiations with India, Badenoch stated, “We can actually sign an agreement before the Indian election. I suspect that that is not necessarily going to be the case because I don't want to use any election as a deadline." She added, "It is possible that that will be done but I am very resistant to deadlines being set on trade negotiations because it runs down the clock. It is very possible that we can sign but I am not using it as a deadline for the work that I am carrying out basically."
Negotiations for the FTA between India and the UK began in January 2022 intending to significantly boost the bilateral trading partnership valued at GBP 36 billion. The 13th round of talks concluded on December 15 last year, with both sides hopeful for a successful outcome in the ongoing 14th round.
The UK's priorities in the negotiations include urging India to reduce tariffs on UK exports such as food, cars, and whisky, which currently face tariffs as high as 150 percent. India, on the other hand, is concerned about the fairness of rules applied to Indian workers temporarily transferred to the UK on business visas who are required to pay national insurance without eligibility for UK pensions or social security benefits.
In her keynote address at the trade conference, Badenoch underscored the need to strike a balance between importing goods from developing countries to support their growth and maintaining high standards of quality and safety. "Our free trade agreements are helping us make the right choices because they are all about diversification and resilience. That is what the Indo-Pacific tilt is about, but we need to make sure that the facts are out there," she stated.
With both India and the UK facing upcoming general elections this year, the urgency to finalize a trade agreement has heightened before leaders on both sides enter campaign mode.
