India-UK Trade Talks Witnesses Reduction of Duties on Certain Commodities

In accordance with people familiar with the situation, India and the United Kingdom have softened their positions on most of their points of contention as both countries try to wrap up trade talks ahead of expected national elections next year.

While New Delhi has agreed to lower tariffs on British cars and scotch whisky, the UK is willing to relax some visa rules for Indian professionals, according to Indian officials who asked not to be identified because the talks are private. Nonetheless, because immigration is a politically sensitive topic in the UK, any visa relaxations are likely to be limited, according to a British official.

Prime Minister Narendra Modi and his British counterpart Rishi Sunak are pushing to double bilateral trade by 2030 through a pact that slashes tariffs and increases market access. The two governments hope to wind up the trade talks before year-end, Indian and British officials said.

The officials added that Britain is willing to accept New Delhi's standards on environmental and labour protections — a key Indian demand given the differences in economic development and sensitivities involved for its micro-, small-, and medium-sized firms.

A trade agreement is critical for India's ambition to become a manufacturing powerhouse, while the UK seeks new agreements to highlight the benefits of Brexit. Sunak and Modi will be able to discuss the issue face to face at the Group of 20 summit in New Delhi next month.

According to a spokesperson for the UK Trade Department, "good progress" has been made in closing chapters, and both countries are now "laser-focused" on goods, services, and investment.