PM Modi may visit UK in October as both sides push for FTA

Updated on Sep 23, 2022 05:50 AM IST

India and the UK are looking to firm up a visit to London next month by Prime Minister Narendra Modi for the signing of a bilateral free trade agreement (FTA), people familiar with the matter said.

Prime Minister Narendra Modi’s planned visit is expected to include a business roundtable with leading business people. (HT file)
Prime Minister Narendra Modi’s planned visit is expected to include a business roundtable with leading business people. (HT file)
ByRezaul H Laskar and Rajeev Jayaswal, Hindustan Times, New Delhi

India and the UK are looking to firm up a visit to London next month by Prime Minister Narendra Modi for the signing of a bilateral free trade agreement (FTA), people familiar with the matter said.

Most of the formal negotiations for the FTA have been completed in five rounds of talks between the two sides and only a few issues remain to be sorted out. The leadership of both countries have said they are looking to conclude the pact by Diwali, which is expected to be celebrated on October 24.

India and the UK are confident about concluding the FTA before Diwali, and it is expected the agreement will be signed by the trade ministers in the presence of the Indian and British PMs, an official aware of developments said.

A final decision on the visit and logistics is expected by the first week of October, the official added, requesting anonymity.

The visit, if finalised, is expected to happen around the time of Diwali, and will be capped by the signing of the FTA, people familiar with the planning on both sides said. There has been no official announcement regarding the matter from both countries. Email queries sent to the PMO and the commerce ministry elicited no response.

Among the issues that are yet to be finalised by the two sides are chapters of the FTA relate to automobiles and mobility and migration, the people said. The British side has offered terms on migration and mobility that are similar to those in the FTA signed by the UK and Australia in December 2021, they added. The UK-Australia pact allows British businesses to hire Australian professionals from a range of sectors, including engineering and architecture. The Indian side is yet to respond to this offer, the people said.

Another official said there is broad agreement on 26 chapters. “Both partners respect sensitivities of each side and adjust accordingly,” he said, requesting anonymity.

The two sides are now engaged in consultations on the fast track to thrash out the remaining issues by early October, the people said.

The Indian side has focused on ensuring a better deal for the mobility of professionals and students, and boosting exports in labour-intensive sectors such as leather, textiles, jewellery, processed agricultural products, marine products, pharmaceuticals and health care.

The UK is looking at tariff cuts for whisky and cars and greater access for digital and legal services.

Commerce secretary BVR Subrahmanyam said on September 3 that the India-UK FTA is “very much on track”. He added, “Our fingers are touching…The Diwali deadline is not going to be missed. Mark my words.”

UK Prime Minister Liz Truss, who assumed office earlier this month after Boris Johnson stepped down, is looking to use the finalisation of the FTA as one the major accomplishments in the early days of her government. Truss reportedly overruled objections from the UK department of international trade on rushing ahead with the FTA with India as there is little possibility of a trade pact with the US being concluded any time soon, the people said.

The FTA is expected to drive UK exports to India to £16 billion a year by 2035 and this is being projected as a significant win by the British side, the people said.

Truss, in her former roles as international trade secretary and foreign secretary, has championed closer economic and strategic ties with India. She had signed off on the India-UK Enhanced Trade Partnership on behalf of the Boris Johnson government in May 2021.

Modi’s planned visit is expected to include a business roundtable with leading businesspeople. In addition to economic issues, the two sides are also expected to unveil a new arrangement for closer cooperation in defence and security, which forms one of the five pillars of the India-UK 2030 Roadmap finalised in 2021, the people said.

The 2030 Roadmap states that the two countries will “complete a set of framework documents including Logistics and Training MoUs and Grey and Dark shipping information sharing agreements” to deepen security ties and enable collaboration between the armed services.

Following its exit from the European Union (EU), the UK has been keen on quickly concluding trade deals with major economies such as India, which recently surpassed Britain as the world’s fifth largest economy.

The UK has concluded deals with 69 countries and one with the EU. India has speedily finalised trade deals this year with Australia and the United Arab Emirates and is in talks with the EU, Canada, and other nations.

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