India-UK FTA a valuable template for ongoing, future international trade talks: Bharti Chairman Sunil Mittal

New Delhi, Jul 25 (PTI) The landmark India-UK Free Trade Agreement (FTA) can serve as a potential template for India's pursuit of similar trade pacts with other nations and blocs, including the European Union, according to Bharti Enterprises Founder and Chairman Sunil Mittal.

Mittal said there are many similarities between the UK and Western European markets and suggested that the strategies used for the UK deal could guide in discussions with the 27-nation bloc.

Asked if India-UK FTA could become template for other trade deals in-the-works, particularly with the EU, Mittal told PTI in an interview: "I think so. This should now focus everybody's mind on the EU. This is out of the way now. EU should be similar playbook now. There are a lot of similarities in the UK and the rest of Western Europe. I don't see any major differences between the negotiating tactics there." Mittal believes that the successful agreement with the UK could place constructive pressure on EU stakeholders to resolve some outstanding and pending issues, as he highlighted EU's scale as an even larger opportunity for Indian exports.

The top honcho traced the arc of India's recent trade outreach, citing FTAs with Australia, the UAE, the four-nation European bloc EFTA, and others.

"If India can finish (deal with) EU, they would have done. UK, Australia is done, EFTA, UAE is done, then what is left is the US which is under active discussions now," Mittal said.

On whether he believes the UK trade deal could help drive reasonable tariff negotiations with the US, too, Mittal said that while the agreement does add strength, drawing comparisons may not be prudent.

"I think this does help...you put one more in the bag, and then go on and negotiate. This definitely adds strength to India's negotiating power. But let's not compare...US is a market set apart from the rest of the world. It is the largest market in the world...imports and exports a lot. They have every product in the world which they can send to India," he said.

He cautioned against viewing the US as directly comparable to some other partners, given its distinct economic scale and global capacity.

"So it's not like Europe or UK, where you don't have the large depth and variety of goods. So one will have to be careful. Indian industry will have to be protected. Indian farmers, dairy. But equally, America, if it's going to open India for the benefits that India will get, will seek benefits in return. So our Commerce Minister Piyush Goyal - who's been very deft in handling this UK trade deal where he's worked day and night under the leadership of our Prime Minister - he'll have to figure out a way there.

But America, at the moment, as you know, the way it's going is less predictable than many other countries in the negotiations. So we'll just have to wait and watch how things progress there," Mittal said.

The India-UK FTA represents a historic milestone for both nations, Mittal said, noting that the agreement reflects a strong complementarity between the two sides.

Mittal, who is also the Co-Chair of the India UK CEO Forum, said Thursday's deal with the UK lays down a clear roadmap and exuded confidence that the target set out of doubling bilateral trade is "absolutely achievable".

"This is a historic moment for both countries, it is rare to see two large economies coming together on a common platform, finding common ground and coming out with a win-win deal like the one which has been signed today...I personally believe that the ambition of doubling trade, both in goods and services, is absolutely achievable. And this is where the role of Indian and British industry will come into play," he said.

The ground is laid and the roadmap is clear, Mittal said, adding that India-UK FTA brings to fore a "high sense of complementarity".

The industry stalwart said the trade deal also offers big opportunities for small and medium enterprises in areas like footwear and leather products, while a three-year exemption on social security contribution would offer a big boost to Indian technology companies.

"We talk about two spectrums...in the hi-tech area, which is, let's talk about small nuclear reactors, so in the clean energy area, hypersonic missiles, drones, UAVs, other defence equipment, which is available in the UK, including the technologies and manufacturing units in very strong measure...I think this is one area of cooperation and collaboration. Plus India is opening up its public procurement to British companies, which is generally not the norm, and that will incentivise the British industries to come and set up a lot of their manufacturing activities in the country, in India," said Mittal, who led the delegation on behalf of CII.

India and the UK on Thursday inked a landmark free trade agreement (FTA) that will cut tariffs on British whisky, cars and an array of items, besides boosting bilateral trade. The FTA is expected to benefit 99 per cent of Indian exports from tariffs and will make it easier for British firms to export whisky, cars and other products to India, besides boosting the overall trade basket.

Further, Indian companies operating in the UK would not have to make social security contributions for up to three years for employees they move from India to support their operations. This is estimated to benefit over 75,000 Indian workers and over 900 employers as it exempts Indian professionals and their employers from these contributions in the UK for a stay of up to 36 months.

"I think this is a good balanced outcome, because if Indian professionals can come and work here for three years and then don't have to give the contribution here in the UK, but carry on doing it in India...that secures them, because when they go back home, at least their pie is safe. They can get benefits, their pensions, their insurance, all those things have not gone to waste. So, think, this is a huge advantage to IT/ITES companies which are working here in the UK...not just technology companies, but even other firms," he said.

Meanwhile, CII DG Chandrajit Banerjee termed the deal as historic while noting that it opens up a phenomenal opportunity for Indian companies. The FTA allows for various areas of collaboration, especially in the manufacturing field, he added.

"It's a win-win situation for us. There is a lot that Indian industry can gain out of this FTA. It is a first for us with such a large European economy. It sets in motion a lot of confidence for the Indian industry," Banerjee noted. PTI MBI MSS MR