UK makes up 3.4 per cent of India’s overall exports, it accounts only for less than 2 per cent of India’s exports.
India’s High Commissioner to the UK Y.K Sinha has said that addressing the issue of immigration of workers will be crucial to the free trade agreement between both the nations after the Brexit is executed.
He was speaking at an event organized on discussing trade prospects between India and the UK after Brexit. He said that while it would be easier to negotiate a bilateral trade agreement with the UK than the entire EU block, it was crucial for India to ensure free movement of its professionals especially in the IT services and financial sectors. It has to be ensured that these professionals can visit and depart from the UK, freely added the India’s High Commissioner to the UK, as quoted by the Hindu.
Sinha said that India and the EU had been discussing the free trade agreement since 1997 and there was no progress made for diverse reasons. These reasons included concerns of the UK on the draft agreement.
Mr. Sinha explained the issues of discussions with a large trade block and said that several interests have to be catered to in this scenario and trade agreements are easier. The instance was the setting up of a joint working group last year.
Facilitating free movement of professionals was beneficial to both India and the UK as they contribute greatly to the economy of the UK when they live there and to the economy of India when they return here.
The event is jointly organized by the university of East Anglia and FICCI and is the latest in the series of discussions that are being held based on prospects of trade relations between both the nations. The UK on its part is very keen to sign a free trade agreement with India and this was stressed by its Prime Minister Theresa May when she visited India last year.
The current scenario was volatile and efforts must be made to leverage the emerging scenario to the advantage of the nation. While the existing trade relations between both the nations were good, much potential remains untapped.
The study report published by the Commonwealth last year pointed out that if a free trade agreement was implemented between India and the UK after the Brexit, it would result in an increase of 25% in trade.Secretary General of FICCI Dr. Didar Singh said that though the bilateral trade between the UK and India would increase for a short term, the Brexit uncertainty will result in adversely affecting the investment of India in the UK. While Britain was a part of the EU, it remained as the chief investment partner of India but the uncertainty caused by the Brexit would hinder the complete investment scenario. We need to comprehend this reality and the potential markets and profitable sectors need to be explored, added Dr. Singh.
International Institute for Strategic studies’ Head of the South Asia Program Rahul Roy Chaudhary said that as uncertainty looms large over the bilateral economic relations between India and the UK, defence and security sectors have the prospects for emerging as the dominant areas in bilateral trade relations.
Rahul Roy Chaudhary also observed that bilateral co-operation between India and Britain had boosted in these areas in the past few years. The instances were signing of initiatives to counter terrorism and prevent terrorist attacks in India, joint initiatives to curb tactical and financial aid to Lashkar-e-Taiba and the signing of an agreement for civil nuclear co-operation.