The resumption of long-stalled discussions for a free trade agreement (FTA) with India has been announced by British Prime Minister Keir Starmer. On the fringes of the G20 summit, Starmer met with Indian Prime Minister Narendra Modi and stressed the significance of creating a “new strategic partnership” between the two countries.
“Our goal to provide growth and opportunity throughout our nation will be advanced by a new trade agreement with India, which will support jobs and prosperity in the UK,” Starmer stated.
A statement from Starmer’s office stated that in addition to pursuing the trade deal, Britain hopes to strengthen its collaboration with India in fields like security, education, technology, and climate change.
PM Modi Highlights Comprehensive Strategic Partnership
Prime Minister Modi described the UK-India partnership as a high priority. In a post on X (formerly Twitter), Modi expressed optimism about enhancing collaboration in sectors like technology, green energy, security, innovation, and cultural exchanges.
“We also want to add strength to trade as well as cultural linkages,” Modi stated. He characterized his meeting with Starmer as “extremely productive.”
Focus on Mutual Gains in Trade Deal
The Ministry of External Affairs (MEA) revealed that both leaders expressed confidence in their negotiators’ ability to establish a “balanced, mutually beneficial, and forward-looking Free Trade Agreement.” India also announced plans to open two new consulates in Manchester and Belfast, reflecting its commitment to supporting the Indian diaspora in the UK.
Key Issues Raised by India
During the talks, Modi raised concerns about the extradition of economic offenders living in the UK, including high-profile individuals like Vijay Mallya, Nirav Modi, and Lalit Modi. India has been seeking their return to face charges at home.
Economic and Strategic Importance
Following Brexit, the UK has been keen to strengthen its economic ties with major global economies, including India. British Trade Secretary Jonathan Reynolds highlighted the significance of an FTA, stating, “Striking a deal with India is important to deliver this government’s core mission of driving economic growth.”
Starmer echoed this sentiment, describing India as one of the fastest-growing economies and a vital trading partner. Reynolds identified lowering Indian tariffs, boosting bilateral investments, and supporting jobs as key British priorities in the negotiations.
“India is the fifth largest economy in the world and a vital trading partner for the UK. A deal with India would boost the UK’s trading relationship, worth £42 billion ($53.22 billion) in the 12 months to June 2024,” the prime minister’s office noted.
Challenges in Previous Negotiations
Trade discussions between the two nations had stalled in March after several years of negotiations. Changes in leadership in both countries have since brought renewed focus to the talks.
Key sticking points in past discussions included India’s demand for increased visas for students and business professionals and the UK’s interest in reducing tariffs on whiskey and automobiles, along with improving access to Indian markets for its service sector.
Renewed Optimism for Progress
With a shared commitment to growth and cooperation, both nations now hope to overcome past hurdles and build a robust trade relationship that benefits their economies and citizens.