India, UK Reaffirm Trade Deal Commitment, Strengthen Economic Ties
New Delhi/London: In a significant step towards bolstering bilateral ties, India and the United Kingdom have reaffirmed their shared commitment to a Free Trade Agreement (FTA) and Bilateral Investment Treaty (BIT), aiming to advance negotiations at pace.
Both nations underscored their intention to secure a mutually beneficial trade agreement, recognising it as essential to enhancing long-term cooperation and economic growth. The dialogue offered an opportunity to assess current progress and identify areas for deeper collaboration.
A major topic of discussion was the UK’s upcoming Industrial Strategy. The British side noted that partnerships with India could play a key role in sectors such as advanced manufacturing, life sciences, clean energy, professional services, defence, and the creative industries. UK expertise in research and innovation was highlighted as complementary to India’s growing role as a global manufacturing and innovation hub.
It added that collaboration would also cover clean energy, financial services, business services, and creative industries to support economic expansion and job creation.
On the defence front, both sides expressed eagerness to sign the upcoming ‘India-UK Defence Industrial Roadmap,’ which is expected to deepen collaboration between industrial sectors and reinforce supply chains. The roadmap aims to support co-development and co-production of defence equipment, aligning with shared strategic interests.
Financial services emerged as another major area of convergence. The two countries acknowledged the steady growth in financial services trade in recent years and pledged to build on this foundation. They committed to expanding cooperation in banking, insurance, pensions, capital markets, fintech, and sustainable finance.
The dialogue offered a platform to explore further financial integration. The next FMD is scheduled to take place in London later this year.
The UK welcomed India’s decision to allow insurance companies in GIFT IFSC to invest overseas and noted ongoing discussions regarding similar permissions for pension funds. These measures are seen as steps toward stronger global financial engagement.
Additionally, both sides emphasised the role of the UK’s bond markets in helping Indian companies raise capital, including through rupee-denominated Masala Bonds. Efforts will be made to develop a policy framework to facilitate broader use of such instruments.
They also talked about the Indian rupee’s increasing globalization. India’s move to permit rupee accounts in overseas jurisdictions was welcomed, and both sides agreed to explore how London could support this initiative, given its stature as a global financial centre.
Another point of collaboration is the UK-India Infrastructure Financing Bridge. Both countries agreed that the UK’s asset management sector could help Indian investors access global funds and pledged to use the next FMD to continue discussions on a supportive policy environment.
Transition finance was also on the agenda. Both nations agreed to mobilise capital for sustainable development and welcomed each other’s initiatives, including the UK’s Transition Finance Market Review.
As global dynamics shift, the India-UK economic dialogue marks a critical step in forging a resilient, future-focused partnership.