India and the UK have relaunched negotiations for a free trade agreement, nearly a year after discussions were paused due to general elections in both countries. On Monday, UK Business and Trade Secretary Jonathan Reynolds met with Indian counterpart Piyush Goyal in Delhi to kick off two days of talks aimed at advancing the negotiations.
The ministers discussed the importance of reaching a “balanced, ambitious, and mutually beneficial” deal, according to Goyal, who shared the update on X. The two countries have held over a dozen rounds of negotiations since 2022, but a final agreement has yet to materialize.
Key points of contention include high tariffs on Scotch whisky in India and easing visa and fee rules for Indian students and professionals looking to work or study in the UK.
This marks the first round of talks since the Labour Party came to power in the UK. Reynolds has emphasized that securing a deal is a “top priority” for his government. “Growth will be the guiding principle in our trade negotiations with India, and I’m excited about the opportunities on offer in this vibrant market,” he said in a statement ahead of the meeting.
India is expected to become the world’s third-largest economy in the near future, making these talks especially crucial. The ministers held a joint press conference after the meeting, but neither side offered a timeline for when the talks would conclude. Previous deadlines set by former Prime Ministers Boris Johnson and Liz Truss passed without a final agreement.
The talks have gained renewed significance following US President Donald Trump’s decision to impose tit-for-tat tariffs on imports from several countries, including India. The UK is also a key trading partner for Prime Minister Narendra Modi’s government, which has set an ambitious target to increase exports by $1 trillion by 2030.
According to a UK government statement, the two countries currently share a trade relationship worth £41bn ($52bn), and a deal could unlock new opportunities, especially in sectors like advanced manufacturing, clean energy, and professional services. British exports such as cars, Scotch whisky, and financial services could also benefit.
India is seeking greater mobility for its professionals and students to the UK and pushing for faster visa processing times. Additionally, India hopes to secure concessions for its residents working in the UK on business visas, as they are required to pay national insurance but are not eligible for social benefits.
At the press conference, Goyal clarified that immigration was not part of the trade negotiations. “India has never ever discussed immigration in any free trade negotiations,” he said, while Reynolds stressed that business mobility was a “separate issue” from immigration.
During his visit, Reynolds will also visit the BT office in Gurugram, and UK Investment Minister Poppy Gustafsson will participate in events in Mumbai and Bengaluru.
India has been increasing its engagement in free trade agreements after years of skepticism, having signed a $100bn deal with the European Free Trade Association last year. It is also set to resume negotiations with the European Union this year.
