India-UK FTA By Diwali: A Look At Current Trade Scenario Between Two Nations

Prime Minister Narendra Modi and his UK counterpart Boris Johnson on Friday discussed trade, climate and energy during the latter’s two-day visit to India. On the India-UK free trade agreement (FTA), Modi said that India has started FTA with the UAE and Australia and it wants to do the same with the UK also. Johnson also said, “We are telling our negotiators to get it done by Diwali.” Here’s the current scenario on the India-UK trade, major exports and import items and FTA negotiations.
The India-UK Trade

According to official data, the bilateral trade in goods between India and the UK stood at USD 16 billion in 2021-22 as compared with USD 13.11 billion in 2020-21, a jump of 22.17 per cent. Exports worth USD 9.43 billion were shipped in 2021-22, while imports worth USD 6.59 billion were received in the same year. This gives a trade balance of USD 2.84 billion in the financial year 2021-22.

The trade between the two countries had stood at USD 15.45 billion in 2019-20, USD 16.87 billion in 2018-19, and USD 14.49 billion in 2017-18.

In 2021, India was the UK’s 15th largest trading partner, and the UK is India’s 18th largest trading partner with manufacturing exports accounting for over 90 percent of India’s export to the UK, consisting of clothing, medicinal and pharmaceutical products, metal manufacturers, organic chemicals , and precious stones.

Major Export Items To UK

Major exports to the UK are ‘furniture, bedding, mattresses’ worth USD 147.72 million in 2021-22; optical, photographic cinematographic measuring, medical & surgical instruments (USD 150.17 million); vehicles other than railway or tramway rolling stock (USD 205.18 million); electrical machinery and equipment & parts and sound recorders (USD 856.73 million); nuclear reactors, boilers, machinery and mechanical appliances (USD 932.77 million). Natural or cultured pearls and precious stones (USD 712.43 million).

This also includes footwear, gaiters and the like (USD 257.22 million); pharmaceutical products (USD 565.32 million); articles of apparel and clothing accessories, knitted or corcheted (USD 647.92 million); plastic and articles (USD 245.51 million); and organic chemicals (USD 240.73 million).
Major Import Items From UK

Among the major items that were imported from the UK in 2021-22 were precious or semiprecious stones, jewellery, coin worth USD 1,735.15 million; beverages, spirits and vinegar (USD 170 million); mineral fuels, mineral oils and products of their distillation (USD 441.89 million); pharmaceutical products (USD 209 million); essential oils, perfumery (USD 135.56 million).

The imports items also include ‘pulp of wood or of other fibrous cellulosic material, waste of paper’ worth (USD 189.58 million); nuclear reactors, boilers and machinery (USD 976.43 million); and electrical machinery and equipment; sound recorders USD 400.40 million.
Items Being Discussed For India-UK FTA

Apart from goods, services and other movements are also being discussed under the India-UK FTA. India wants movement of skilled workers and data adequacy status, while the UK asks for duty concessions for whiskey and scotch, imported automobiles, apples, pears, quinces, and lamb meat.

India also wants the resolution of regulatory issues in the pharmaceutical sector and duty concessions for textiles, footwear, leather products, basmati rice. The UK wants greater access to medical devices and legal, accounting and financial services.

India and the UK in January launched talks for a free trade agreement, with an aim to double the trade by 2030.

Read all the Latest News , Breaking News and IPL 2022 Live Updates here.