Media reports India, UK to ink trade agreement
(MENAFN) India and the United Kingdom are expected to sign a long-pending free trade agreement (FTA) during Indian Prime Minister Narendra Modi’s visit to the UK this week, according to Indian media reports.
The Indian cabinet has already given its approval for the deal, and final preparations such as legal reviews are currently underway, Foreign Secretary Vikram Misri confirmed on Tuesday.
The UK ranks as India’s sixth-largest investor with a total investment of $36 billion, while India has invested nearly $20 billion in the UK.
Negotiations for the FTA have been ongoing since 2001 but were delayed due to the UK’s demands for better trade conditions, including tariff reductions on exports to India.
India is also pushing for a "double contribution convention pact," which would exempt Indian IT professionals working in the UK from paying social security taxes for up to three years. This measure could benefit around 60,000 workers by boosting their take-home pay by roughly 20%.
As part of the agreement, India will gradually lower tariffs on UK whisky and gin from the current 150% to 75%, and then to 40% over a ten-year period. Automotive product duties will also fall from over 100% to 10%, though within set import limits.
The deal also includes proposed duty reductions on a variety of goods such as cosmetics, aerospace parts, lamb, medical equipment, salmon, electrical machinery, soft drinks, chocolates, and biscuits.
After the agreement is signed, it will need to be ratified by the British Parliament. India is simultaneously pursuing trade agreements with both the US and the EU.
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