India and the UK began negotiating a Free Trade Agreement (FTA) and Bilateral Investment Treaty with the now voted out Conservative Party government, with negotiations now expected to pick up from the fourteenth round of negotiations under a Labour-led regime.
“The Gulf and India are the priority. I think there are clear economic and commercial reasons why we should pursue those,” Business and Trade Secretary Jonathan Reynolds said at the International Investment Summit in London this week, which marked 100 days of the Labour Party government this week.
“Trade and international investment lie at the heart of our plan to drive growth for the whole country. That’s because we know the UK has so much potential as one of the largest, most open economies, a legal system that sets global standards, a regulatory environment with some of the strongest safeguards for investment and the greatest incentives for innovation. We benefit from a skilled and diverse workforce, supported by an immigration system that draws talent from around the globe,” he said.
The minister’s comments reiterate the UK’s commitment to an FTA with India, negotiations for which remain stalled since the general election in July but are expected to resume in the coming weeks.
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The International Investment Summit at the Guildhall was pitched as an opportunity to showcase the UK’s economic strengths and demonstrate that enduring partnerships with businesses can be established through stable governance. In a keynote address to open the summit, UK Prime Minister Keir Starmer vowed to do everything in his power to galvanise growth by getting rid of regulation that needlessly holds back investment.
He said: “We’re a country where businesses thrive – small and large alike, with clear regulatory frameworks and protections. A legal system that sets high standards around the globe. A location which means we can speak to our colleagues in the Americas or Asia in the same day.
“A high ranking in the Global Innovation index, every year, our wonderful global language, our world-renowned sport and culture, this great modern city (London) and all around us a heritage steeped in commerce and trade, a set of shared values – centuries-long – for being a country that is open for business. You can’t put a price on any of this.”
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The summit culminated in the Department for Business and Trade (DBT) confirming nearly 38,000 jobs set to be created across the UK after a total of £63 billion in investment is expected to pour into the country. With India projected to be the world’s third-largest economy by 2027, a trade deal is expected to give UK businesses better access to a burgeoning market of middle-class consumers projected to grow to over a quarter of a billion consumers by 2050.
All eyes are now on when the newly mandated teams after general elections in both countries finally enter the negotiating rooms to get the deal over the line, given that the FTA has been dubbed “the floor not the ceiling” of UK ambitions to unlock the shared potential of the bilateral ties.