India-UK conclude fifth round of FTA talks
India and the United Kingdom (UK) concluded the fifth round of talks for an FTA on the 29th of last month.
In the fifth round of talks, technical experts from both sides came together to discuss 15 policy areas.
Currently, India is holding FTA talks with some of its trading partners including the European Union, Canada and Israel.
Consensus between both countries
Officials in India and the UK will continue to work intensively throughout the summer to finalize talks on a comprehensive and balanced free trade agreement by the end of October 2022.
UK agrees to end duties on Indian rice and textile items.
India may allow duty-free entry of British apples, medical equipment and machinery manufactured in the UK.
India initially proposed an early harvest agreement or interim FTA that would be ready by Diwali.
Through this agreement, India-UK bilateral trade is estimated to double to about $100 billion by 2030.
An agreement is also expected to be reached on mutual recognition of higher education qualifications.
India is likely to get more skill visas, as the UK currently faces a shortage of experts in the IT and programming sectors.
The India-UK FTA agreement is also expected to give a boost to the domestic textile sectors.
What is Free Trade Agreement (FTA)?
Under this agreement, customs duties, regulatory laws, subsidies and quotas etc. are simplified on the products under import-export between two countries.
Its main objective is to simplify trade.
A major advantage of FTA is that the cost of production of the two countries between which this agreement is made becomes cheaper as compared to other countries.
This encourages trade and gives impetus to the economy.
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