India, UK Working on Mobility Regime for Service Sector Workers Under FTA : Officials

Syllabus:  General Studies-II, International Relations;

Subject: International Relations;

Topic: India relations with Global Powers;

Issue: India-UK FTA;

Context: The United Kingdom (UK) is not keen on providing easier mobility norms for India’s services industry, a demand that India is seeking as part of the proposed Foreign Trade Agreement (FTA) between the two nations.


  • While India wants easier visa norms for its companies in the services sector that function out of Britain, the UK has been reluctant given migration concerns.
  • The FTA between India and the UK, originally slated for Diwali 2022, is yet to be finalized as the two sides continue to negotiate on a few unresolved issues, including Rules of Origin, United Kingdom’s demand for tariff concessions on electric vehicles, and norms about services.

What is a Free Trade Agreement?

  • A free trade agreement is a pact between two or more nations to reduce barriers to imports and exports among them.
  • Under a free trade policy, goods and services can be bought and sold across international borders with little or no government tariffs, quotas, subsidies, or prohibitions to inhibit their exchange.
  • The concept of free trade is the opposite of trade protectionism or economic isolationism.

How a Free Trade Agreement Works?

  • Free-trade policy may simply be the absence of any trade restrictions.
  • A government doesn’t need to take specific action to promote free trade. This hands-off stance is referred to as “laissez-faire trade” or trade liberalization.
  • Governments with free-trade policies or agreements in place do not necessarily abandon all control of imports and exports or eliminate all protectionist policies.
  • In modern international trade, few free trade agreements (FTAs) result in completely free trade.

Status of India’s FTAs:   Strategic Considerations at the core

Peru And Chile : India is commencing negotiations for an FTA with Peru and Chile.

  • From Peru and Chile there is a good possibility of securing critical mineral supply which will help in our energy transition for battery making.
  • So in addition to trade, now, we are looking at FTAs from the point of view of our strategic considerations.

Australia: Agreement talks also include smooth supplies of critical minerals like lithium, nickel, cobalt, manganese and graphite which are the key minerals used in batteries.

  • Major issues in talks include digital trade, government procurement, and rules of origin.
  • Exploratory discussions are on to include 15 new areas in Comprehensive Economic Cooperation Agreement (CECA), and that include competition policy, MSME, gender, innovation, agri-tech, critical minerals and sport.

With Canada:

  • 9th round of talks was held last month.
  • Issues in the negotiations include goods, trade remedies, rules of origin and services.
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