NEW DELHI: With the European Union and the United Kingdom striking a post-Brexit trade pact, India should now aggressively pursue free trade agreements (TLC) separately with both regions, according to experts.
Although it is premature to assess the gains for India from the agreement between the European Union (EU) and the United Kingdom, Indian products would not benefit much from this agreement, they said.
However, India can explore opportunities in service sectors such as IT, architecture, research and development and engineering in both markets, as the EU-UK pact does not cover services, they added.
“There is not much profit for Indian products, but we can win in the service sector in both the UK and the EU markets. We will earn more in the UK market as we are an English speaking country,” he said. the director of the Federation of Export Organizations of India (FIEO). General Ajay Sahai said.
He said that there are no specific tariff benefits for domestic products derived from this agreement.
“We should now push forward the FTA negotiations with both the EU and the UK. Indian competitors like Vietnam have a greater tariff advantage in sectors such as apparel and marine products,” Sahai said.
Sharing similar views, Biswajit Dhar, an economics professor at Jawaharlal Nehru University, said that India had many contentious issues while negotiating the FTA with the EU. However, after Brexit, the UK could have a different stance on those issues and now “India should continue the FTA talks with both regions.”
He added that there is the possibility of making a favorable free trade pact with the United Kingdom.
FIEO President Sharad Kumar Saraf said India should now move “aggressively” in initiating negotiations for the FTA with both the EU and the UK.
“We have asked the government to sign a MoU (Memorandum of Understanding) regarding a deadline to conclude the FTA talks with Great Britain during British Prime Minister Boris Johnson’s visit to India next month,” Saraf said.
Rakesh Mohan Joshi, Professor at the Indian Institute of Foreign trade (IIFT) said that after the trade deal with the EU and the UK, India will have a better chance to meet the demands of both markets.
“But India needs to plan accordingly,” he added.
The chairman of the Apparel Export Promotion Council (AEPC), A Sakthivel, said the India-UK FTA would help remove the downsides of customs duties faced by domestic players in Britain.
Britain closed a landmark deal with the European Union on Thursday when both sides managed to pass a post-Brexit free trade deal just days before the December 31 deadline.
Two-way trade between India and the UK declined to $ 15.5 billion in 2019-20 from $ 16.9 billion in 2018-19.
.
