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  • 16 August, 2022

  • 9 Min Read

India - UK Relations

India - UK Relations

According to Britain Meets India (BMI) Report by Grant Thortan Bharat in collaboration with The Confederation of Indian Industry, trade between India and the UK is expected to double by 2030 as a result of the proposed free trade agreement, investments in technology, diversification of global supply chains, and ease of doing business (CII).

The top industry that UK firms are looking to invest in India is business services, with Maharashtra being the top state for investment followed by the National Capital Region and Karnataka.

About Proposed Free Trade Agreement

  • The proposed FTA is anticipated to increase Indian exports in labour-intensive industries like education, pharmaceuticals, health care, and the production of leather, textiles, jewellery, processed agri-products, and marine products.
  • The UK is likely to consider lowering taxes on goods like apples, machinery, and medical devices made in the country.
  • Additionally, UK businesses anticipate India to take steps to strengthen data protection and uphold agreements.

India's Trade with the UK:

  • With a total investment of almost USD 31.92 billion between FY 2000 and FY 22, the UK remained the sixth largest investor in India.
  • This made up around 5.4% of all the foreign direct investment (FDI) that India received.
  • In FY 2022, India's trade with the UK in goods and services totalled USD 31.34 billion, up from USD 19.51 billion in 2015.
  • A total of 4.66 lakh people are employed by the 618 UK companies that have been located in India, and they generate a combined annual revenue of Rs 3,634.9 billion.


  • The conclusion of a Comprehensive Strategic Partnership in 2021 is evidence that the India-UK relationship has been improving despite the challenge given by the Ukraine conflict.
  • In addition, a 2030 Roadmap for India-UK relations was formed, which largely specifies the cooperation goals for the two-way relationship.
  • Both nations conducted discussions on expanding their defence and cyber security cooperation as well as on trade relating to the military.
  • In order to safeguard the online infrastructure in both India and the UK, a new cooperative cyber security program is about to be announced.
  • The first Strategic Tech Dialogue, a ministerial-level forum on new technologies, will also be held by India and the UK.
  • The UK will join India's Indo-Pacific Oceans Initiative and become a significant partner on marine security problems in Southeast Asia, thereby strengthening the two countries' maritime relations.
  • India and the UK finished the first phase of negotiations for a free trade agreement in January 2022. The talks revealed common goals between the sixth-largest economy in the world (India) and the fifth-largest economy in the world (the UK).

About Free Trade Agreement

  • It is an agreement between two or more countries to lower import and export restrictions.
  • Under a free trade policy, there are little to no government tariffs, quotas, subsidies, or prohibitions that prevent the exchange of products and services across international borders.
  • The idea of free trade is the antithesis of economic or trade protectionism.

FTAs between India and Australia ECTA:

  • India will profit from Australia's offer of preferential market access on all of its tariff lines.
  • Over 70% of India's tariff lines will grant Australia preferential access.

South Asian Free Trade Area (SAFTA):

  • A Free Trade Agreement is confined to goods but excludes all services like information technology.
  • This agreement was signed to reduce customs duties of all traded goods to zero by the year 2016.

Other Trade Agreements signed by India


  • The Comprehensive Economic Partnership Agreement (CEPA) establishes a framework for promoting and enhancing commerce between the two nations.

India and Mauritius have a Comprehensive Economic Cooperation and Partnership Agreement (CECPA):

  • It is a form of free trade agreement that intends to offer a formal system for promoting and enhancing trade between the two nations.
  • Countries decrease or do away with the levies on the products under this agreement. To encourage trade in services, the nations also ease their regulations.

The South Asia Preferential Trading Agreement (SAPTA),

  • It came into effect in 1995 and is a trade promotion agreement for the member nations of South Asia.

APTA: Asia-Pacific Trade Agreement

  • It was formerly known as the Bangkok Agreement and was a preferential tariff system designed to encourage intra-regional trade through the exchange of mutually acceptable concessions between member nations

Also Read - Global Employment Trends for Youth: ILO

Source: The Hindu

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