Commerce and Industry Minister Piyush Goyal said the Enhanced Trade Partnership between India and the UK announced on Tuesday will increase bilateral trade cooperation, reduce market entry barriers and boost job creation in both the countries. Prime Minister Narendra Modi and his UK counterpart Boris Johnson on Tuesday launched an ‘Enhanced Trade Partnership’ (ETP) to unleash the trade potential between the two economies.
As part of the ETP, India and the UK agreed on a roadmap to negotiate a comprehensive and balanced free trade agreement, including consideration of an interim trade pact for delivering early gains. “It will enhance bilateral trade cooperation, reduce market entry barriers and boost job creation in both countries. Looking forward to working with Rt. Hon @TrussLiz (UK International Trade Secretary) to further expand and deepen our trade relationship,” Goyal said in a tweet.
In a separate statement, the UK India Business Council said free trade agreement is the right eventual goal and it is hugely encouraging that the ETP will address market access barriers and ease of doing business immediately and on an ongoing basis.
UKIBC Group Chair, Richard Heald, OBE said that “today’s announcement of a 10-year roadmap working towards an FTA will take the bilateral relationship to the next level. In the immediate term, the focus will rightly be on removing market access barriers.”
The bilateral trade between India and the UK stood at USD 15.45 billion in 2019-20 as against USD 16.87 billion in 2018-19, according to commerce ministry data.
The announcement of a new trade and investment deal with India worth GBP 1 billion that would generate more than 6,500 jobs in Britain “is really the tip of an iceberg”, UK Trade Secretary Liz Truss said on Tuesday. The deal, announced by UK Prime Minister Boris Johnson ahead of a virtual meeting with his Indian counterpart Narendra Modi, includes a 240 million pound investment by the Serum Institute of India, which will support clinical trials, research and possibly the manufacturing of vaccines.
Indian investment deals will create 1,000 new UK jobs each at health and tech firms Infosys, HCL Technologies and Mphasis. Some 667 UK jobs will be created at Q-Rich Creations, 500 jobs at Wipro and 465 at 12 Agro. “Each and every one of the more than 6,500 jobs we have announced today will help families and communities build back from coronavirus and boost the British and Indian economies,” Johnson said.
Truss told the BBC that the jobs would be created “within the next year or so”. She said those commitments were “very different” from a free-trade deal, which the two governments will start negotiating on this autumn. Discussions will include lowering tariff barriers and new agreements on “digital and data”.
The announcement on 6,000 jobs “is really the tip of an iceberg” Truss said. Trade between the UK and India is worth about 23 billion pounds per year, and the government hopes to double that by 2030.
“What we need to do is get the huge tariffs removed on products like whisky, which is over 100%; cars, which is over 100% – that is where the real opportunities lie for us,” she said. The do that, the UK is likely to have to relax immigration rules between India and the UK, she said.
“We’ve already made significant steps in improving the immigration regime with the post-study work visa. We’ve seen a massive rise in Indian students coming to the UK,” she said. “Business mobility is a key part of trade. Particularly as the UK and India are both very strong in services, you need to make sure you’re able to get your professionals over to the country,” Truss added.
Meanwhile, British businesses have secured export deals with India worth more than 446 million pounds, which are expected to create more than 400 British jobs, the BBC report said. They include a 200-million pound deal involving CMR Surgical, which will create 100 new UK jobs, it added.
The Confederation of British Industry (CBI) said the updated trade partnership “shows the world the strength of our relationship”. CBI president Lord Bilimoria said the talks would “unlock opportunities for businesses, boost job creation and growth across the country”.