Piyush Goyal said India and UK are moving towards an early harvest trade agreement. (File)
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 Mr 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, Mr 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.
Mr 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.
Mr 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.
"If necessary, we may also explore signing a few Mutual Recognition Agreements (MRAs) in selective services like nursing and architecture services," it added.
MRAs pave the way for recognition of the professional bodies of one country by the other. Regulatory bodies of various professional services like engineering, nursing, accountancy and architecture are encouraged to enter into these pacts.
UK Secretary of State for International Trade Liz Truss, in a statement posted on her Twitter handle, announced the launch of trade working groups to lay the groundwork for a forthcoming UK-India trade agreement.
"Today Piyush Goyal and I launched trade working groups to lay the groundwork for our forthcoming UK-India trade deal, which will: boost access to more than a billion consumers; bolster our science and tech industries; and support jobs in both countries," she said.
The UK''s Department for International Trade (DIT) said the talks between the two ministers focussed on the scope and ambition for a UK-India FTA, following the close of the UK''s formal consultation process ahead of the negotiations on August 31.
The UK government said these regular ministerial dialogues help both sides better understand each other''s position on potential chapter areas in any trade deal, including tariffs, standards, IP (Intellectual Property) and data regulation.
Ms Truss reaffirmed her ambition to negotiate a trade agreement that delivers results for the British people and businesses, including those in digital and data, tech and food and drink. Both ministers agreed that continuing to engage with the business community was vital throughout the forthcoming negotiations, DIT said.
According to officials, findings from the DIT''s public consultation will be published before the start of formal trade negotiations as part of a wider package outlining a strategic rationale for the FTA, including the UK''s negotiating objectives and economic analysis of a potential deal.
Earlier, the UK trade ministry said that preparations towards an FTA with India was progressing. A deal would represent a major boost for UK exporters, lowering tariffs, easing regulation, and driving up bilateral trade which totalled GBP 23 billion in 2019, it noted.
Increasing UK-India trade has been dubbed a huge opportunity by the UK, given India''s position as one of the world''s biggest and fastest-growing economies and home to more than a billion consumers.
"We are looking at a comprehensive trade agreement that covers everything, from financial services to legal services to digital and data, as well as goods and agriculture. We think there is a strong possibility for us to get an early agreement, where we lower tariffs on both sides and start to see more goods flowing between our two countries," Ms Truss said.
The bilateral trade between the two nations stood at USD 13.11 billion in 2020-21 as against USD 15.45 billion in 2019-20. Trade balance is in favour of India.
India''s main exports to the UK are textiles, gems and jewellery, engineering goods, petroleum products, transport equipment, spices, machinery and instruments, pharmaceuticals and marine products.
The main imports from Britain include precious and semi-precious stones, ores, metal scraps, engineering goods, chemicals and machinery. In the services sector, the UK is the largest market in Europe for Indian IT services.
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)