Eye On Donald Trump's Tariffs, FM Nirmala Sitharaman To Visit UK; FTA On Cards - Details

India’s Finance Minister Nirmala Sitharaman is set to visit London from April 8-10, where discussions on the Free Trade Agreement (FTA) and the Bilateral Investment Treaty (BIT) between India and the UK are expected to be key topics.

Key Meetings and Discussions

During her three-day visit, Sitharaman will attend the India-UK Economic and Financial Dialogue and meet with UK’s Chancellor of the Exchequer, Rachel Reeves, along with other British ministers.
 

"Issues pertaining to the trade agreement and bilateral investment treaty may also come up for discussions," an official source stated.

India-UK FTA: Background and Status

The India-UK FTA talks began on January 13, 2022, but faced an eight-month pause before resuming on February 24, 2024. So far, 14 rounds of negotiations have been completed. Along with the FTA, both nations are negotiating a Bilateral Investment Treaty (BIT) and a Double Taxation Avoidance Agreement (DTAA).

Key Issues in the Agreement

Market Access for Professionals & Goods – India seeks easier visa rules for students and professionals in the UK, along with duty-free access for its exports.

Lower Import Duties – The UK wants India to reduce tariffs on Scotch whisky, electric vehicles, lamb meat, chocolates, and financial services.

Investment Dispute Resolution – A major hurdle in the BIT is how disputes between investors and governments will be resolved.

Economic Ties & Trade 

Bilateral trade between India and the UK grew from $20.36 billion in 2022-23 to $21.34 billion in 2023-24. The UK is the sixth-largest investor in India, with $35.3 billion in FDI since April 2000.

India’s recent decision to raise the foreign investment cap in the insurance sector to 100% could further boost negotiations. The upcoming meetings in London could play a crucial role in accelerating the long-awaited trade deal.