In July, under the Joint Economic and Trade Committee (JETCO), the governments of UK and India agreed to remove barriers to trade as part of a roadmap to a Free Trade Agreement (FTA). The two have agreed that the governments will establish an enhanced trade partnership, which is the first step for a roadmap to a UK-India FTA. In an interview with BusinessLine , Jayant Krishna, the first Indian CEO of the UK-India Business Council, spoke on the mutual areas of co-operation and FTA agreement between both the countries. Excerpts:

What are the areas of mutual collaboration the countries are looking at, especially in the background of Covid-19?

India invested in 120 projects and created 5,429 new jobs in the UK to become the second-largest source of foreign direct investment after the US in 2019.

The Department for International Trade (DIT) inward investment statistics for 2019-20 data found India accounted for 4 per cent FDI increase for the UK in 2018-19, with 1,852 new inward investment projects in financial year 2019-20.

With global corporations looking to derisk their supply chains, the UK is looking at a significant increase in trade from sectors such as healthcare & lifesciences, packaged food & drinks, education and information technology.

From India’s point of view, it has requested that duties on packaged foods such as daal, and dairy products be reduced, while the UK is seeking reduction in import duty for Scotch liquor.

In areas such as healthcare, amongst others, the UKIBC also welcomes the continued focus of both governments on tackling barriers to trade. India already supplies about 25 per cent of the goods and services associated with the NHS. Indian hospitals can look at collaboration, and cost of intervention can further reduce healthcare costs. The Covid-19 pandemic has taught us that the best way to solve a global problem is through collaborative solutions, possible when businesses and governments come together.

In July, the UK India Business Council signed a Memorandum of Understanding (MoU) with Maharashtra Industrial Development Corporation (MIDC) for infrastructure development in the state. In Gujarat, we signed an MoU with Industrial Extension Bureau (iNDEXTb), Industries and Mines Department, Government of Gujarat, to boost business and industrial development in the state. It will also aim to proactively enhance the business environment and strengthen collaboration with British businesses in Gujarat.

Countries such as India, US, Japan, Australia and France have taken an anti-China stance and are offering incentives to companies to de-risk their supply chains. What are your views?

Relocation of supply chains takes a lot of time. Companies (in the UK) are exploring their options. You have to remember that this will happen over time, as not everybody can shut off their supply chains or reduce their dependence on China overnight. Companies need more incentives and governments need to travel that extra mile. In India, the Performance-Linked Incentive (PLI) for the manufacturing sector is a laudable effort, which has resulted in achieving good size with regard to the domestic mobile phone manufacturing industry. India can take advantage of the fact that Chinese labour before Covid-19 was starting to get expensive.

The Indian IT sector has been facing visa-related restrictions in the US. Will you look to attract IT-related investments into the UK?

The UK is changing its immigration programme, especially after departure from the EU in 2020. A new immigration Bill will end free movement from the EU and introduce a points-based system for all overseas workers, focused on attracting only workers categorised as high-skilled. If you look at the data, in 2019, around 57,000 tier-2 visas (skilled work visas) were issued to Indians, representing more than half of all the 114,000 tier-2 visas issued by the UK. This continues a positive trend, with around 55,000 Indians receiving a tier-2 skilled work visa in 2018. Additionally, Indian nationals saw a notable increase in the number of tier-4 (student) visas granted in 2019, up 93 per cent from the 37,540 of 2018, continuing an increase seen since 2016. In education, especially higher education, 20 of the top 100 institutions are in the UK. Now with the National Education Policy (NEP), institutions such as Imperial College and Cambridge are eyeing the 3.7-crore undergraduate student market in India. For the same, we are working on mutual recognition of degrees in both countries.

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