The UK and Indian prime ministers agreed the Enhanced Trade Partnership (ETP) between India and the United Kingdom last month. This isn’t a Free Trade Agreement (FTA) yet, but the parties agreed to negotiate one as soon as possible. The target is to more than double the bilateral trade by 2030.
More immediately, the UK government has said that the ETP will, in the short term, result in an extra 6,500 jobs, thanks to Indian investment in the UK. On closer inspection, this investment does not appear to have resulted from any government-to-government arrangements but because of investment which is happening for commercial reasons. To be fair to civil servants in both countries, however, government activity has facilitated the signing of those investment deals.
India and the UK have launched ‘Roadmap 2030’, a plan to expand and deepen bilateral cooperation in five areas:
- people-to-people relationships
- trade and prosperity
- defence and security
- climate action
- healthcare cooperation.
The two countries agreed to continue removing trade barriers on the path to an FTA.
Trade deal highlights:
- Investments up to £1bn to raise finance in the London market, including through listing and bond issuance.
- A £240m investment by the Serum Institute of India in the UK into their vaccine business and a new sales office which will create a large number of jobs. The sales office is expected to generate new business worth over $1bn, £200m of which will be invested into the UK. Serum’s investment will support clinical trials, research and development and possibly manufacturing of vaccines. This is a key component in the world’s fight against future pandemics.
- Expansion of UK-India vaccines partnership, highlighting the successful collaboration between Oxford University, Astra Zeneca and the Serum Institute of India on an effective Covid-19 vaccine that is developed in the UK, made in India and distributed globally, according to the ETP.
- Commitment to deepening co-operation in educational services and concluding work on the recognition of UK higher education qualifications, which will encourage an increase in student flows, skills transfer and knowledge sharing between the UK and India.
- To remove barriers in the Indian legal services sector preventing UK lawyers from practicing international and foreign law in India, a step that will strengthen the UK-India legal corridor for effective legal services.
- Memoranda of Understanding on Global Innovation Partnership, Migration and Mobility Partnership, Digital and Technology, Agreement on Customs Cooperation etc. This will create a new scheme on youth mobility. Every year up to 3,000 young Indian professionals will be able to take up employment opportunities in the UK for a period of two years without being subject to any labour market test. UK has such arrangements only with selected partner countries such as Australia, Canada, Japan and South Korea. This has been offered to India for the first time.
- Agreement between the Customs Authorities in India and UK will facilitate exchange of information, effective coordination and develop trade facilitation actions in the field of customs in accordance with international standards including all matters relating to the application of customs legislation.
What does this mean for British businesspeople?
If you have a trading or investment opportunity that relates to India, you are more likely to be able to get cost-effective help from the Department of International Trade, as the British government is motivating civil servants to help on anything India related.
The healthcare sector and related industry/services is particularly likely to benefit, as is defence, since these two sectors are singled out by both countries. Now is the time for businesses in those sectors to be reaching out to counterparts in India.