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regular-article-logo Tuesday, 25 June 2024

UK, Oman trade agreements may figure in Commerce ministry's 100-day agenda for new Government: official

The ministry will also focus on issues pertaining to the exporting community with a view to promoting the country's outbound shipments

PTI New Delhi Published 24.03.24, 11:52 AM
Prime Minister Narendra Modi and Oman’s Sultan Haitham bin Tarik  https://www.millenniumpost.in/big-stories/india-oman-adopt-vision-document-to-expand-ties-544562

Prime Minister Narendra Modi and Oman’s Sultan Haitham bin Tarik https://www.millenniumpost.in/big-stories/india-oman-adopt-vision-document-to-expand-ties-544562 File

India's proposed free trade agreements (FTAs) with the UK and Oman are expected to figure in the commerce ministry's 100-day agenda roadmap for the new government, an official said.

The ministry will also focus on issues pertaining to the exporting community with a view to promoting the country's outbound shipments.

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Further talks between India and Australia to expand the scope of existing economic cooperation and trade agreement (ECTA) for a comprehensive economic cooperation agreement (CECA) are also progressing at a healthy rate.

The exercise assumes significance as while chairing a Cabinet meeting on March 17, Prime Minister Narendra Modi asked the ministers to meet secretaries and other officials of their respective ministries to discuss how the agenda for the first 100 days and the next five years can be better implemented.

The seven-phase Lok Sabha polls, the world's biggest election exercise, will kick off on April 19 with the counting of votes set to take place on June 4.

The official said that these two FTAs are in their final stages as talks on most of the issues have been concluded.

"The majority of difficult matters in India-UK FTA negotiations are moving towards resolution, and both sides are actively engaged for a fair and equitable deal," the official said.

India and the UK launched talks for an FTA in January 2022. There are 26 chapters in the agreement, which include goods, services, investments and intellectual property rights.

The 14th round of negotiations was held in January. Chapter-wise textual negotiations are near close, and the schedule on goods and services is at an advanced state of negotiations. Recently, a team from the UK visited India for negotiations on outstanding issues.

The bilateral trade between India and the UK increased to USD 20.36 billion in 2022-23 from USD 17.5 billion in 2021-22.

According to a report by the think tank GTRI (Global Trade Research Institute), the overall gains for India in the trade deal will be limited because most of the goods from here are already entering the UK at low or zero tariffs (import or customs duties).

In 2022-23, India's merchandise exports to the UK were valued at USD 11.41 billion and out of this, USD 6 billion worth of goods such as petroleum products, medicines, diamonds, machine parts, airplanes, and wooden furniture entered Britain at zero levies, it has said.

However, there will be gains from reducing duties for Indian exports worth USD 5 billion and those items include textiles, apparel (shirts, trousers, women's dresses, bed linen), footwear, carpets, cars, marine products, grapes and mangoes, the report has noted.

On the proposed free trade agreement between India and Oman, the official said that this will be concluded "very" soon.

For India, Oman is the third largest export destination among the Gulf Cooperation Council (GCC) countries. India has already implemented a trade pact with another key GCC member - the UAE.

The bilateral trade between India and Oman stood at USD 12.39 billion in 2022-23 as against USD 10 billion in 2021-22. India's exports have increased to USD 4.48 billion in 2022-23, while imports rose to about USD 8 billion in the last fiscal year.

Another GTRI report has stated that Indian goods worth USD 3.7 billion such as gasoline, iron and steel, electronics, and machinery will get a significant boost in Oman, once both sides reach a comprehensive free trade agreement as these goods at present attract 5 per cent customs duty.

Export sectors which could get a boost in Oman include motor gasoline (exports worth USD 1.7 billion), iron and steel products (exports worth USD 235 million), electronics (USD 135 million), machinery (USD 125 million), textiles (USD 110 million), plastics (USD 64 million), boneless meat (USD 50 million), essential oils (USD 47 million), and motor cars (USD 28 million), will benefit from duty elimination, the report has said.

Key products imported by India to Oman in 2022-23 included petroleum products (USD 4.6 billion), urea (USD 1.2 billion); propylene and ethylene polymers (USD 383 million).

Currently, more than 80 per cent of India's goods enter Oman at an average of 5 per cent import duties, the GTRI report has said.

The current government has so far signed trade deals with Mauritius, Australia, the UAE and four European nations EFTA bloc.

India has so far signed as many as 14 FTAs and six preferential pacts with its trading partners to promote exports and ensure greater market access for domestic goods and services.

Except for the headline, this story has not been edited by The Telegraph Online staff and has been published from a syndicated feed.

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