Three years ago, On April 22, 2022, British Prime Minister Boris Johnson was visiting India where he called Prime Minister Narendra Modi his “Khaas Dost” and said the two leaders asked their negotiators to conclude an agreement on the free trade agreement by “Diwali” of 2022.
The two parties missed this deadline, but they accomplished it on Tuesday marking a central point on a bilateral arch, led by the Minister of Trade of the Union, Piyush Goyal, who crossed the political spectrum in London.
Shortly after announcing the agreement, speaking at an ABP Network event, Modi said that he had spoken to Prime Minister Keir Starmer. “This agreement for mutual trade and economic cooperation between two major open market economies in the world will add a new chapter to the development of both countries,” he said.
The appellant “excellent news for our young people”, Modi said that this would stimulate economic activity in India, would bring “new opportunities for Indian companies and MPMs”.
Referring to recent trade agreements with water, Australia and Mauritius, he said: “India does not only reform, but actively engages with the world to make a shopping center and dynamic trade.”
The finalization of India-Uk Ale marks three key dishes to remember.
First, the United Kingdom stole a walk on the other two FTAs, India is negotiating with the United States and the European Union. From Brexit, in January 2020, talks on a bilateral trade agreement have grown and the United Kingdom has neglected aggressively with India in the past three years. The modified geo-economic environment gave a feeling of urgency to the pace.
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After US President Donald Trump imposed universal prices and then paused on 90 days, India began negotiating an agreement with the United States. The United States Secretary of the Treasury, Scott Bessent, said that with India could be one of the first trade agreements with the United States.
It was the culmination of Prime Minister Modi’s talks with US President Trump in February and the recent visit to Vice-President JD Vance.
The European Union also put pressure for the India-EU FTA and this was also reflected when the 22 College of European Commissioners visited India in February of this year, led by the head of the EU Ursula von der Leyen.
That the United Kingdom has sealed the first puts India to an advantage as it speaks with Washington and Brussels (which must negotiate on behalf of 27 European member countries) to extract key concessions.
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Second, the agreement has the printur of bipartite consensus in the United Kingdom. Johnson had launched negotiations in 2022; The last telephone conversation between his successor Rishi Sunak and Modi took place on March 12, 2024 – before India and the United Kingdom appeared in the elections.
In this call, Sunak and Modi “have positively evaluated the progress made to the early conclusion of a mutually beneficial free trade agreement”. In a sense, a major part of the negotiations was completed and understanding was that the leaders would take the thread after the elections.
The conservatives lost, and on July 6, one day after Keir Starmer led a landslide working the 14 years of conservative rule, Modi spoke to him and the two leaders “agreed to work on an early conclusion of an Indian-beneficial Indian free trade agreement”.
According to 10, Downing Street, the British Prime Minister, while discussing the ALE, said that he was ready to conclude an agreement “which worked for both sides”.
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In a sense, it was a transparent transition between conservatives and work – Arc political rivals. What helped is that the Coalition government led by the Modi BJP has entered the third term.
Thirdly, the FTA strengthens the economic relationship which is the most crucial pillar of the “full strategic partnership” in India -Uk – as the defense pillar is with the French and the Russians.
This pact unlocks the potential of economic ties and can also strengthen confidence in other key sectors.
The bilateral trade in India-UK (good and services) amounted to 40.9 billion pounds sterling during the four quarters until the end of the third quarter of 2024 (until September). The total imports of India from the United Kingdom amounted to 17.5 billion pounds sterling and the total exports of India amounted to 23.4 billion pounds sterling. India was the 11th Trade Partner of the United Kingdom during this period, representing 2.4% of the UK total trade.
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India retains the position of the second source of foreign direct investment (IDE) in the United Kingdom after the United States. The United Kingdom is the 6th investor in India.
In this context, FTA adds depth and extent to bilateral links. The Indian declaration reports this: “This agreement cements the solid foundations of the complete strategic partnership of India-Uk and opens the way to a new era of collaboration and prosperity.”
Defense and security, from critical education technologies, the Indian diaspora to tourism – India and the United Kingdom endeavor to strengthen the links between the sectors. Modi invited Starmer to visit India soon, and as an Indian civil servant has summed it up, “the FTA is the soil, not the ceiling (for the relationship).” With the entries of Vikas Pathak
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