British Prime Minister Boris Johnson on Monday announced a trade and investment deal worth £1 billion with India. The agreement aims to double trade between the two countries by 2030, specifically enhancing trade relations in the areas of health, climate, technology, and defence. The declaration came just a day prior to a virtual summit between the two sides, which will see the participation of Johnson and his Indian counterpart Narendra Modi. While the summit was originally supposed to be held in person, it was cancelled due to the surge of COVID-19 cases seen in India.
“Like every aspect of the UK-India relationship, the economic links between our countries make our people stronger and safer...In the decade ahead, with the help of a new partnership signed [on Tuesday] and a comprehensive free trade agreement, we will double the value of our trading partnership with India and take the relationship between our two countries to new highs,” Johnson said in a statement.
The deal paves the way for £533 million worth of Indian investments in the UK, further creating 6,000 British jobs in the health and technology sectors. For the health sphere, the agreement includes a £240 million investment by Serum Institute India into the UK to enhance its British businesses’ vaccine production capabilities. According to a press release from the British Prime Minister’s Office, these investments aim to support clinical trials, research, and developments, which will in turn generate a “large number of jobs” in the sector. Further, it will also strengthen the UK’s fight against the COVID-19 pandemic, the statement added.
When it comes to technology, India intends to enhance its investments, which will generate 1,000 British jobs at Infosys, HCL Technologies, and Mphasis. In addition, the agreement also includes deals worth £200 million that aim to support low carbon growth. It further allows British businesses to secure export deals worth £446 million to India.
During their virtual summit on Tuesday, Johnson and Modi are set to announce the “Enhanced Trade Partnership”, which is supposed to help “remove barriers to trade” and mark a step towards a prospective trade deal between the two countries. It also aims to enhance bilateral cooperation in the educational and legal services sector. In February 2021, as a part of her four-day visit to India, British Secretary of State for International Trade Elizabeth Truss met with Indian Minister of Commerce and Industry Piyush Goyal to discuss this initiative as well.
The UK’s decision to enhance trade cooperation with India comes as it looks to establish closer trade ties with its allies following its exit from the European Union (EU). One of the consequences of Brexit is that it will now be able to enter into such bilateral trade deals with countries across the globe, including India, which is one of the EU’s leading trade partners. Moreover, this will actually benefit the UK’s Free Trade Agreement negotiations with India, as several difficult issues that have held back India’s trade discussions with the EU, such as dairy products, agricultural produce, and automobiles, no longer impact the UK. Therefore, such agreements will help the UK in reducing the combined impact of Brexit and the COVID-19 pandemic on the British economy. In this pursuit, India will be a significant partner, with bilateral trade between the two countries hitting $15.45 billion during the financial years of 2019-2020.
UK PM Unveils Trade Deal Increasing Indian Investment in UK Health and Technology Sectors
British Prime Minister Boris Johnson announced an “Enhanced Trade Partnership”, which is the first step towards a Free Trade Agreement.
May 4, 2021
SOURCE: PTI