India-UK Free Trade Agreement Poised to Boost Trade
During Prime Minister Narendra Modi’s visit to the UK on Thursday, India and the United Kingdom are set to exchange a comprehensive Free Trade Agreement (FTA) document, spanning more than 2,000 pages. This landmark pact is expected to significantly enhance bilateral trade and investment flows between the two nations.
What Is the India-UK FTA?
The proposed FTA aims to reduce customs duties, relax trade regulations, and offer tariff concessions on a wide range of goods and services. The agreement also covers broader areas such as intellectual property rights, investment, and government procurement, making it a far-reaching strategic economic pact.
Key Objectives and Economic Impact
Under the agreement, India and the UK will work to:
- Lower tariffs on each other’s exports and imports
- Remove non-tariff barriers to ease market access
- Simplify trade regulations and certification processes
- Encourage investment flows and job creation
Such agreements are designed to improve trade competitiveness, attract foreign direct investment (FDI), support MSME growth, and expand India’s reach in global markets.
India’s Expanding FTA Network
India currently has over 15 active FTAs, including with:
- ASEAN, Japan, South Korea, Singapore, Thailand, Malaysia
- Australia, UAE, Mauritius, Sri Lanka, Bhutan
- European Free Trade Association (EFTA) — Norway, Switzerland, Iceland, Liechtenstein
These FTAs have helped India diversify its exports and solidify its position in sectors like IT, healthcare, education, agriculture, and green energy.
Notable Benefits from Existing FTAs
- 90% of Indian exports to UAE now duty-free, aiding textiles, pharma, and gems
- 12% export increase to UAE in the first year post-agreement
- 25% rise in FDI from Australia after signing the bilateral trade deal
- 15% boost in textile exports to ASEAN countries
- Increased agricultural exports to Mauritius, including sugar and tea
- Gains in technology transfers, standardization, and green energy projects
Strategic and Diplomatic Significance
Beyond economic benefits, FTAs like the India-UK agreement deepen diplomatic ties, promote sustainable development, and reflect a shared vision for mutual prosperity and global economic cooperation.
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