India, UK aim to start FTA talks by Nov 1

London/New Delhi: India and the UK are aiming to start negotiations for the proposed bilateral free trade agreement by November 1, a move aimed at enhancing trade and investments between the two countries.

Commerce and Industry Minister Piyush Goyal on Tuesday said the two countries are moving towards an early harvest trade agreement, with a comprehensive FTA (Free Trade Agreement) as the next step.

The UK expressed hope that there is a "strong possibility" to get an early agreement on trade between the two countries.

The matters related to FTA came up during a virtual meeting between Goyal and his British counterpart Secretary of State Elizabeth Truss on Tuesday.

"Proposed FTA between India and the UK is expected to unlock extraordinary business opportunities and generate jobs. Both sides have renewed their commitment to boosting trade in a manner which benefits all," India's Commerce and Industry Ministry said in a statement.

Speaking on the occasion, Goyal said there is a keenness to have an early conclusion of negotiations for quick and early economic benefits to businesses on both sides.

He also informed that substantial work has already been done and extensive stakeholder consultations have been held involving industry, business associations, export promotion councils, buyers/sellers associations, regulatory bodies, ministries, and public research bodies for the proposed pact.

Further, bilateral working groups for different tracks have been formed to understand ambitions, interests and sensitivities of each other to facilitate accelerated progress during the negotiations. The meetings of these groups are presently in progress and are likely to be completed by September.

Goyal said these discussions would help both sides in understanding each other's policy regimes and would put us in a better position when both sides begin their joint scoping discussions, beginning on October 1, for finalising the terms of references for launch of negotiations in November.

"An interim trade agreement, as a first step of a FTA would allow both of us to immensely benefit from the early gains of the partnership," he said, adding that India and UK are strengthening trade ties by moving towards an early harvest deal followed by a comprehensive FTA.

In a free trade agreement, two or more trading partners significantly reduce or eliminate customs duties on the maximum number of goods traded between them besides liberalising norms to promote trade in services and investments. In an interim trade pact, customs duties are removed on a limited number of goods.

Goyal emphasised the need to strike a balance between commitments and concessions in goods and services.

Further, the statement said that certain services of mutual interest may be included in the interim agreement through the request offer approach wherein it can include priority sectors which are immediately deliverable.