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Context: United Kingdom Prime Minister announced joint investments by the UK and India to the tune of 1 billion pounds across IT, electric vehicles and health sectors on the first day of his two-day India trip.
Key highlights of the meet:
- Investment made in areas from software engineering to health will generate as many as 11,000 new jobs across the UK.
- UK and Indian businesses will confirm more than £1 billion in new investments and export deals in areas from software engineering to health, creating almost 11,000 jobs across the UK.
- The £1 billion investment, will be spread across a new Switch Mobility electric bus R&D centre in the UK and the opening of their Asia Pacific Headquarters in Chennai, generating over 1,000 jobs in the UK and in India.
- India and the UK are likely to discuss amplifying their defence cooperation. UK is also making an Indo-Pacific tilt.
Recent developments:
Recently, UK-India signed a trade and investment deal worth 1 billion pounds.
Details of the deal:
- It was part of an Enhanced Trade Partnership (ETP).
- ETIP aim:
- to double the value of UK-India trade by 2030 and declare a shared intent to begin work towards a comprehensive Free Trade Agreement (FTA).
- to address several trade barriers, including the lifting of restrictions to enable fruit producers across the UK to export apples, pears and quince to India for the first time.
- To secure improved access for medical devices through the acceptance of “UK Certificates of Free Sale” in India.
India and UK 2030 vision is for:
- revitalized and dynamic connections between people;
- re-energised trade, investment and technological collaboration that improves the lives and livelihoods
- of citizens;
- enhanced defence and security cooperation that brings a more secure Indian Ocean Region and IndoPacific
- India-UK leadership in climate, clean energy and healththat acts as a global force for good.
- Through this ambitious Roadmap, India-UK relationship will elevate to a Comprehensive Strategic Partnership (CSP).
New areas of cooperation:
- Both democracies are working cohesively to deter aggressors and are developing deeper ties between Britain and India in the Indo-Pacificwhich would not only result in job creation, but also foster security in the region.
- India and U.K. are engaging for defence-related trade and deepening cyber security and defence cooperationbetween the two countries.
- A new joint cyber security programmeis set to be announced, which aims to protect online infrastructure in India and the U.K. as both parties attempt to carry out joint exercises to combat threats from cyber criminals and ransomware.
- India and the U.K. also plan to hold the first Strategic Tech Dialogue, a ministerial-level summit on emerging technologies.
- and India have agreed to strengthen their cooperation in the maritime domainas the U.K. will join India’s Indo-Pacific Oceans Initiative and become a major partner on maritime security issues in Southeast Asia.
- India is a key strategic partner for the U.K. in the Indo-Pacific both in terms of market share and defence, India has signed the Defence and International Security Partnershipdeal with U.K. in 2015.
- is a regional power in the Indo-Pacificas it possesses naval facilities in Oman, Singapore, Bahrain, Kenya, and British Indian Ocean Territory.
- The U.K. has also confirmed £70 million of British International Investmentfunding to support the usage of renewable energy in India, which will help in building renewable energy infrastructure and developing solar power in the region.
- India and the U.K. recently concluded the first round of talks for an India–U.K. Free Trade Agreement.
- For Britain, a successful conclusion of an FTA with India would provide a boost to its ‘Global Britain’ ambitionsas the U.K. has sought to expand its markets beyond Europe since Brexit.
- Britain has been trying to seize opportunities in the growing economies of the Indo-Pacific to cement its place on the global stage as a serious global actor.
- The newer areas of cooperation — namely fintech, market regulation, sustainable and green finance, and cyber security— have emerged as the new frontiers of this engagement.
Background of India-U.K. economic relations
- Guiding principle: The economic and commerce matters of India and U.K. are guided by the India-UK Joint Economic & Trade Committee, Economic and Financial Dialogue and India-UK Financial Partnership.
- Existing trade balance: Merchandise trade between the two countries was US$15.45 billion in 2019-20 with the trade balance in favour of India.
- FDI inflow:
- India became the second-largest source of FDI according to the Department for International Trade inward investment statistics for 2019-2020.
- UK is the 6th largest inward investor in India with a cumulative equity investment of US $28.39 billion, accounting for around 6% of all foreign direct investment into India.
- Trade basket: The main products of export from India to the UK include:
- Articles of apparel & Clothing
- Accessories
- Power Generating Machinery & Equipment
- Petroleum and related products
- Manufactured articles
- Textile Yarn
- Footwear
- Medicinal and Pharmaceutical
- Manufactures of metal
- Road Vehicles
- Transport Equipment
The main products of import from UK to India include:
- Power Generating Machinery & Equipment
- Non-Ferrous Metals, Ferrous ores & Metal scrap
- General Industrial Machinery and Equipment & Machines
- Beverages
- Electrical Machinery and Appliances
- Professional, Scientific and controlling instruments and appliances
- Chemical materials & products
New trajectory of the India-U.K. relationship:
- The 2030 Roadmapaims to double bilateral trade between India and the U.K. by 2030.
- Both India and the U.K. are engaging in robust dialogues to promote cooperation on strategic and defence issuesboth in the Indo-Pacific as well as at the global level.
- India is evolving as a ‘leading power’ and the U.K. recalibrates its strategic outlook post-Brexit, which is a unique moment in India-U.K. ties.
https://theprint.in/diplomacy/uk-pm-talks-powerhouse-partnership-with-india-says-new-delhi-moscow-relationship-different/925502/
