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The UK and India maintain the momentum for Enhanced Trade Partnership

Update on the latest policy engagement in India

25 Nov 2020, 3 min read

The relationship between the UK and India has gone from strength to strength, with over 11% increase in trade over the previous year, now worth £24 billion and continued investment in India worth £140 million during the pandemic months.

The recent ministerial engagements – JETCO review and the 10th Economic and Financial Dialogue, act as a rolling stone to renewed commitment of post-Brexit Enhanced Trade Partnership (ETP) between the UK and India. The ETP negotiations are currently underway, which hopefully will pave the way for a future UK-India Free Trade Agreement.

The 14th UK – India Joint Economic and Trade Committee (JETCO) meeting on 28 July 2020, agreed to prioritise five key areas: life sciences, information communications technology (ICT), food and drink, chemicals, and services to address non-tariff barriers to trade towards first an enhanced and eventually a free trade agreement. The UK is the second fastest growing G20 investor in India over the last 10 years and British companies have invested nearly £22 billion since 2000.

The recent review meeting on 12 November 2020 between the UK Secretary of State for International Trade Liz Truss, along with Minister for International Trade Ranil Jayawardena and Indian counterparts, Commerce and Industry Minister Piyush Goyal and Minister of State Hardeep Singh Puri, took stock of steps taken so far to unlock market access barriers to open up further opportunities for businesses on both sides in November.

The 10th Economic and Financial Dialogue was held on 28 October 2020 between Chancellor Rishi Sunak and India’s Finance Minister Nirmala Sitharaman. The discussions focused on collective efforts on Coronavirus and the global economy, sustainable recovery, financial growth and fintech innovators. The UK and India are two of the world’s top seven economies with a combined GDP of over $5 trillion. Under the new infrastructure partnership, the UK will support India’s infrastructure pipeline by sharing experience, knowledge exchange and technical assistance to support India’s National Infrastructure Pipeline, including setting up a Project Preparation Support Facility-cum-Centre of Excellence for PPP Projects.

Next steps

The next on the agenda will be the two new bilateral dialogues along with continued push to address market access barriers:

  • UK-India Investment Dialogue – It emphasises the importance of non-discriminatory treatment of foreign investors, stable tax and regulatory regime and a positive investment environment.
  • UK-India Tariff Dialogue – to lower tariffs on a small set of goods apart from easing rules for select services

Collaboration is very clear and growing between the UK and India – and we the businesses could and should do so much together. The Indian economy is nine times larger than it was in 1990 and it continues to grow. The UK businesses can unlock great opportunities with exporting to and investing in India. The CBI recently launched Sterling access: 2020 Review highlighting the progress on business reforms in India and recommendations to ease operations for British businesses.

Get involved

For more information and feedback on market access issues, please contact our CBI India team – Shehla Hasan or Sakshi Jain