India and Britain will aim to more than double bilateral trade in a decade, Indian Trade Minister Piyush Goyal said on Monday, as the two countries resumed trade talks under the shadow of tariff threats from US President Donald Trump.
The countries would speed up talks on a proposed trade deal, including a free trade pact and an investment treaty, Goyal said at a joint press conference with Britain’s Business and Trade Secretary, Jonathan Reynolds.
The ministers did not respond directly to questions about whether their talks were impacted by Trump’s orders to raise tariffs and take other measures to counteract what he sees as barriers to American goods.
Pathbreaking pactTheir joint statement said the resumption of trade talks had come out of discussions between their prime ministers on the sidelines of the G20 summit in November, an event which took place in the run-up to Trump’s inauguration.”
This will be a pathbreaking free trade agreement,” Goyal said, adding it could boost merchandise trade with Britain two to three times within a decade, without giving a detailed timeline.
Bilateral trade in goods and services between India and Britain, currently the world’s fifth and sixth-largest economies respectively, touched £41 billion ($52 billion) in the 12 months till September 2024, British government estimates show.
Trade talks were paused in March last year ahead of elections in both countries.After years of delays, India signed trade agreements with several countries including the UAE and Australia in 2022, and a pact last year with the European Free Trade Association, a group made up of Switzerland, Norway, Iceland and Liechtenstein.
Earlier this month, India slashed tariffs on bourbon whisky to 100% from 150% after Trump’s criticised “unfair” levies in the South Asian market.Sticking pointsKey hurdles include India’s steep import duty on British whisky and its demand to make it easier for Indian firms and professionals to get visas to work in Britain.
“There are always sensitivities in trade negotiations that you have to respect,” Reynolds said, citing India’s concerns over Britain’s demands for India to lower agricultural tariffs and open its market for dairy products.Rejecting some media reports, Goyal said immigration would not be a part of any discussions under the trade pact.
Reynolds said his government was dealing with immigration as a separate issue outside the trade talks.’Top priority’The India-UK trade discussions are the first since the Labour Party came to power in Britain in July last year.
Reynolds said securing a deal is a “top priority” for his government.Britain’s Investment Minister, Poppy Gustafsson, is also expected to meet investors in the financial capital Mumbai and IT hub Bengaluru to urge Indian businesses to invest.Both countries would also discuss a separate treaty on social security, besides trade and investment pact, Goyal said.
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