Wait On India-UK FTA To Continue As England Settles Into Poll Mode

The long-awaited conclusion of the India-UK Free Trade Agreement is likely to extend until a new government forms in the United Kingdom. However, trade talks are expected to continue, irrespective of the electoral outcome.

On Tuesday, India's Commerce Ministry indicated that outstanding issues to seal the deal will be resolved once the general elections in the UK are over.

On May 22, UK Prime Minister Rishi Sunak announced that general elections would be held on July 4.

Similar to India's model code of conduct, the UK observes a pre-election period of sensitivity in the weeks leading up to an election or referendum, called the "purdah,"  which pauses FTA talks.

An FTA with India is likely to remain on the cards, irrespective of the party that comes to power. The pace of the negotiations will be decided once the government forms, according to an official with knowledge of the matter who spoke on condition of anonymity.

This is also evidenced by the fact that, leading up to the 2024 general elections in the UK, the Labour Party—which will face off with Sunak's Conservative Party—has also expressed interest in continuing FTA talks with India.

The Labour Party's manifesto released on June 13 mentions strengthening partnerships with allies and regional powers, and this includes a strategic partnership with India on the FTA as well as deepening cooperation in areas like security, education, technology and climate change.

Negotiations between India and the UK started in January 2022, with the 14th round still underway. There are 26 chapters in the agreement, which include chapters on goods, services, investments, and intellectual property rights.

Unresolved issues between the two sides include topics such as rules of origin, the UK's demand for duty concessions on electric vehicles, liquor and norms about services, including visas for skilled Indian professionals.