INDIA
- UK FTA – ECONOMY
News:
UK FTA: Template for
other trade pacts in mind, India moves cautiously
What's
in the news?
● As
India and the UK engage in negotiations to resolve contentious issues in the
ongoing talks for the India-UK Free Trade Agreement (FTA), the
overarching focus from New Delhi’s perspective is to ensure a comprehensive
deal without ceding too much ground, given that this deal will serve as a
template for all upcoming trade pacts, including ones being discussed with the EU (European Union) and the EFTA (European
Free Trade Association) countries viz., Iceland, Liechtenstein, Norway and
Switzerland.
India
- UK Relations:
1.
Enhanced trade relationship:
● India
and the UK are two of the largest economies on the planet. Economic
relationship between the two is reaching new heights with an enhanced trade partnership.
2.
Minimised trade barriers:
● Both
have lowered several trade barriers, pledged to bring down many more and set an
ambitious target to double the value of
India-UK trade by 2030.
3.
Opening up opportunities in UK:
● Since
then, Indian firms, including established businesses and recent startups, have
been finding opportunities in the UK.
4.
Business and investment in India:
● British
businesses in fields ranging from food to financial services are expanding and
investing in India.
● The
car manufacturer, McLaren, which has just opened a showroom in Mun is one
example.
5.
FTA's beneficial for future and mutual growth:
● An
India-UK free trade agreement is a natural next step for both, bringing two
nations with extraordinary plans for their futures closer still.
Free
trade agreements (FTA):
● Free
trade agreements are agreements between the two or more countries or trading
blocks that primarily agree to eliminate or reduce customer tariff and
non-tariff barriers on substantial trade between them.
Importance
of Free Trade Agreements:
1.
FTA include multiple trade aspects:
● FTAs
cover a wide array of topics such as tariff reduction impacting the entire manufacturing and the agricultural
sector; rules on services trade; digital issues such as data localization;
intellectual property rights that may have an impact on the accessibility of
drugs; and investment promotion, facilitation, and protection.
2.
Great impact on economy and society:
● Consequently,
an FTA has a far-reaching impact on the economy and society.
● Given
this, one legitimately expects transparency and greater scrutiny of the FTA
process both during and after the negotiations.
FTA
Benefits to India:
1.
Greater market access works both ways:
● Prime
Minister Modi has urged Indian businesses to export their products to the world
with "zero- effect,
zero-defect".
● In
other words, high-quality goods with no environmental impact. A free trade
agreement between our nations could further help achieve this target.
● It
would help Indian firms to sell to a market that imported almost £820 billion of goods and services from
around the world in the last 12 months on record.
2.
UK will aid in the ongoing India's economic progress:
● The
Indian economy's future is an exciting one, with the prospect of new technologies, growing businesses and
better jobs for its citizens.
● The
UK has the skills and experience to aid this progress. A deal that's right for
both could make it cheaper and easier for ambitious Indian businesses to tap
into this expertise.
● It
is also only right that the millions of SMEs that power India's economy benefit
from a deal.
3.
Investment in one another's economy will multiply the opportunities:
● The
British cybersecurity solutions firm, Telesoft Technologies, has just said it
will pump £10 million into its India subsidiary over the next five years
supporting a growing telecoms sector.
● A
free trade agreement that smooths British and Indian firms' path to invest in
one another's economy would mean such opportunities multiply.
4.
FTA can be a force of primary economic growth in uncertain times:
● A
free trade agreement's value cannot be measured entirely in rupees and pounds.
● Covid-19's impact on supply chains,
slow global economic growth and volatile markets mean
we are living in uncertain times, where free trade could be the primary force
of prosperity throughout history.
● It
will help to build the long-term security that people around the world need
right now.
In the economic uncertainty, free trade can be
considered as the answer to building the long-term security that people around
the world need right now. It would be great to have the UK alongside on this
journey, as we together can use trade to benefit our citizens and the world.