Prime Minister Narendra Modi on Thursday held first his interaction with Rishi Sunak and congratulated him for taking charge of Prime Minister of United Kingdom. During the telephonic conversation, both leaders agreed on the importance of early conclusion of a comprehensive and balanced Free Trade Agreement, tweeted Modi.
Taking to Twitter, PM Modi said that they will work together to further strengthen our Comprehensive Strategic Partnership.
Glad to speak to @RishiSunak today. Congratulated him on assuming charge as UK PM. We will work together to further strengthen our Comprehensive Strategic Partnership. We also agreed on the importance of early conclusion of a comprehensive and balanced FTA.— Narendra Modi (@narendramodi) October 27, 2022
Indian-origin MP Rishi Sunak on Tuesday was officially appointed as the Prime Minister of the United Kingdom. His tenure comes at a critical juncture when the UK faces “profound economic challenge” and needs someone to take on the gloominess and negative outlook surrounding the economy, which could be headed towards a recession.
Sunak said that India and the UK will deepen their security, defence and economic partnership in the months and years ahead.
Thank you Prime Minister @NarendraModi for your kind words as I get started in my new role.The UK and India share so much. I’m excited about what our two great democracies can achieve as we deepen our security, defence and economic partnership in the months & years ahead. pic.twitter.com/Ly60ezbDPg
— Rishi Sunak (@RishiSunak) October 27, 2022
Sunak is the third prime minister this year and will enter Downing Street as the youngest PM in two centuries. He announced his bid to become the prime minister days after Liz Truss announced her resignation from the top post on October 20 after party members rebelled against her citing that her mini-budget negatively affected the UK economy.
The free-trade agreement (FTA) was earlier planned to be signed by Diwali this year (October 24), it could not be materialised due to the death of Queen Elizabeth II and the political churn and economic turmoil in the UK.
What Is A Free-Trade Agreement?
A free-trade agreement is a pact between countries under which customs tariff and non-tariff barriers are reduced or eliminated on a substantial amount of trade. The FTAs may include trade in goods and services, intellectual property rights and investment, among others.
In May 2021, Prime Minister Narendra Modi and his then UK counterpart Boris Johnson announced an “enhanced trade partnership” as a first stage of a possible comprehensive free-trade agreement. Since then, five rounds of negotiations have completed and the talks are in final stages. In the fifth round in August, technical experts from both sides came together for detailed draft treaty text discussions in 85 separate sessions covering 15 policy areas.
How Much Is The Trade Between India and the UK?
The UK is the sixth-largest source of FDI for India, with inflows of $32 billion between April 2000 and June 2022. The UK is also the seventh-largest export destination for India. The trade between the two countries has seen a significant jump in the past decade, with the bilateral trade rising 22.7 per cent to $13.1 billion between FY21 and FY10.
In 2021-22, the bilateral trade in goods between India and the UK got a boost when it rose to $16 billion in 2021-22 as compared with $13.1 billion in 2020-21, a jump of 22.17 per cent. In the current financial year 2022-23 so far, the India-UK bilateral trade stood at $8.85 billion, which is around 40 per cent higher year-on-year as compared with $6.28 billion in the year-ago corresponding period, according to official data.
According to data from data analytics firm GlobalData, India’s exports to the UK stood at $8.15 billion during the period 2020-21, while imports were recorded at $4.95 billion.
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