INDIA's commerce and industry minister Piyush Goyal on Thursday said the India-UK Free Trade Agreement (FTA) will be a game changer in the areas of trade, investment and services.
Speaking to PTI after signing the agreement with UK secretary of state for business and trade Jonathan Reynolds, Goyal said it was “remarkable” that talks which began over 20 years ago have now led to a “fair, equitable and balanced agreement”. The signing was witnessed by prime ministers Narendra Modi and Keir Starmer at Chequers in Buckinghamshire.
“Truly this is going to be a game changer, in trade, in investments, in the services sector and help both India and the UK grow and our people benefit,” Goyal said. He said the agreement has the potential to double India-UK trade to USD 120 billion in the next five years.
He said the FTA will create new opportunities for farmers, MSMEs, and various sectors. “Our farmers will get a lot of opportunities, because we can process those farm products and market them in the UK. Our MSME sector will get a plethora of opportunities in aircraft parts and auto components, various engineering products. Our textiles will see a massive spurt in demand, because now on a competitive basis, we will be right on top with zero duties,” he said.
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He added that other sectors such as leather, footwear, toys, furniture and pharma products will also benefit. “A very wide range of India's own strengths, which we are currently exporting in big measure across the world, will find markets in the United Kingdom,” Goyal said.
The minister also spoke about the Double Contribution Convention (DCC), which will be enforced along with the FTA.
“Our people who come and serve in UK for short term, two years or three years, who today land up losing almost 25 per cent of their earnings in Social Security, which never gives them any benefit, will now have an opportunity under the DCC to pay this money into their provident fund account in India, and that money will be secure. That money will be giving them an over 8 per cent tax-free return and will become their pension and Social Security in the long run,” he said.
He said that although parliamentary ratification in the UK will take time, the agreement already brings clarity to businesses, given the bipartisan support in Britain.
“The UK parliamentary process will take a few months. The good part is that it has always had bipartisan support. It was largely negotiated when the Conservatives were in power, and today, with the Labor government, it has culminated into a robust and very fair and balanced agreement, and therefore, I think this will get cleared pretty quickly,” Goyal said.
“Businesses will be already planning, because there's a stable and predictable environment. The Free Trade Agreement will be known to everybody, and businesses can start integrating their supply chains and can start planning the benefits of this agreement, planning their business growth because of this agreement. So, I think the work will start right away. The benefits will start accruing in a few months,” he added.
Goyal described the agreement as a personally fulfilling moment and said it was concluded with a good rapport with his UK counterpart.
“I feel very humbled that prime minister Modi reposed confidence and faith in me to be able to conclude this agreement, which has been quite complicated,” he said.
“Many, many years have gone by. Talks have been on and off, but I feel very humbled by the experience. I feel very, very satisfied with the outcome, and I'm sure what started as a very difficult negotiation, but has concluded in a very friendly and very amiable relationship, will continue in the years to come to be a torch bearer for the progress and development of both countries,” Goyal said.
(With inputs from PTI)
