FM Sitharaman Embarks on London Visit for Pivotal Talks on FTA and Investment Treaty with UK
Finance Minister Nirmala Sitharaman will travel to London for three days from Tuesday for high-level deliberations on different economic issues, including a planned free trade agreement (FTA) and a bilateral investment treaty (BIT) with the United Kingdom.
The trip will also witness her being part of the India-UK Economic and Financial Dialogue, where issues such as market access for goods and services, dispute settlement mechanisms, and financial services will be discussed.
While negotiations for the FTA are within the Union Commerce Ministry's purview, issues pertaining to the investment treaty and regulation of financial services are within the Finance Ministry's domain.
These talks are particularly vital as the two nations are still finalizing a broad trade agreement that is set to strengthen economic cooperation and improve trade relations.
In spite of great strides in the negotiations, a number of key points of the trade deal are not finalized, especially in relation to the BIT. The BIT seeks to increase protection for the investments between India and the UK.
But one of the contentious issues is the mechanism of resolving disputes. India is adamant that foreign investors should run out of all local judicial remedies before approaching international arbitration.
In the last few months, India and the UK have renewed negotiations for the FTA after a gap of eight months.
The negotiations that were initiated in January 2022 have so far led to 14 rounds of negotiations.
Trade between the two nations saw a notable increase in 2023-24, with bilateral trade reaching $21.34 billion, up from $20.36 billion the previous year.
The UK remains one of the largest foreign investors in India, with a total of $35.3 billion in foreign direct investment between April 2000 and September 2024.
This three-day trip by FM Sitharaman signifies the growing economic relationships between India and the UK to focus on addressing critical issues in order to increase their trade ties.
