• Prime Minister Narendra Modi met with his British counterpart Keir Starmer on the sidelines of the G20 Summit in Rio de Janeiro, Brazil. This was the first meeting between the two Prime Ministers. 

• Both leaders agreed to take forward an ambitious India-UK Comprehensive Strategic Partnership to take the relationship to new heights in trade and investment, security and defence, technology, climate, health and education.

• As part of this they agreed to relaunch India-UK trade talks early next year. 

• Both leaders underlined the importance of resuming the Free Trade Agreement (FTA) negotiations at an early date and expressed confidence in the ability of the negotiating teams, to address the remaining issues to mutual satisfaction, leading to a balanced, mutually beneficial and forward looking agreement.

• They also welcomed the recent launch of the Technology Security Initiative, and discussed the opportunities for further cooperation on defence and security.

FTA to help double bilateral trade by 2030

• India and the UK formally launched negotiations for the proposed Free Trade Agreement (FTA) in January 2022.

• It is expected to help double bilateral trade by 2030 and boost economic ties between the two countries.

• India-UK bilateral trade (both goods and services) stood at £36.3 billion during the FY 2022-23. India was the UK’s 12th largest trading partner in this period accounting for 2.1 per cent of UK’s total trade.

• The UK is the sixth largest inward investor in India, with a cumulative equity investment of $34.30 billion (April 2000-June 2023), accounting for around 5.31 per cent of all foreign direct investment into India

• In May 2021, Prime Minister Narendra Modi and the then British PM Boris Johnson committed to an Enhanced Trade Partnership which could double the trade by 2030, strengthening relationship and invigorating respective economies through an FTA. 

• This Enhanced Trade Partnership is part of a wider 2030 Roadmap which covers the full spectrum of the UK-India bilateral relationship. 

• The pact will help in boosting Indian exports of leather, textile, jewellery and processed agri products.

• Besides, the Mutual Recognition Agreements (MRAs) on pharma could provide additional market access. There is also great potential for increasing exports in service sectors like IT/ITeS, nursing, education, healthcare, including AYUSH and audio-visual services.

• India will also seek special arrangements for the movement of its people.

• India’s main exports to the UK are articles of apparel & clothing accessories, power generating machinery & equipment, petroleum and petroleum products, textile yarn, fabrics, footwear, medicinal & pharmaceutical products, engineering goods, transport equipment, spices, and marine products.

• The main imports from the UK to India are non-ferrous metals, metalliferous ores & metal scrap, industrial machinery, transport equipment, beverages, electrical machinery, and appliances, professional-scientific instruments and chemicals.

• In the services sector, the UK is the largest market in Europe for Indian IT services.

• A UK-India agreement would help to put Britain at the heart of the Indo-Pacific region, an area representing over 40 per cent of global GDP and containing some of the world’s fastest growing economies. As these economies expand, it is key that the UK has access to their markets.

The 2030 Roadmap includes commitments to:

• Expand the UK-India health partnership to enhance global health security and pandemic resilience. This includes firming up international supply chains to ensure critical medicines, vaccines and other medical products reach those who need them most.

• Expand the UK-India partnership on tackling climate change, by accelerating the development of clean energy and transport and new technology, protecting nature and biodiversity and helping developing countries adapt to the impact of climate change.

• Deepen the economic relationship between the UK and India through an Enhanced Trade Partnership and confirming our intent to negotiate a Free Trade Agreement with a view to doubling UK-India trade over the next decade.

• Increase cooperation between British and Indian universities on crucial research in areas like health, emerging technologies, and climate science – and bringing enterprises together to propel ground-breaking innovations to communities that need them most. 

• Cooperate closely to tackle threats to our shared security in all their forms. 

• Enhance migration relationship, to make it easier for British and Indian nationals to live and work in each other’s countries.

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