India, UK agree to be ambitious on services deal in FTA negotiations

Pointing out that services make up 71% of UK's GDP and 54% of India's, the statement released after India-UK dialogue said both countries recognise importance of services in their economies

India, UK Flags, India-UK pact — Pointing out that services account for 71 per cent of UK's GDP and 54 per cent of India's, the statement released after India-UK Economic and Financial Dialogue said both countries recognise the importance of services in their respective economies.

2 min read Last Updated : Sep 03 2021 | 12:31 AM IST

India and the United Kingdom on Thursday expressed their commitment to working out a free trade agreement and said the two countries would be ambitious while negotiating on services in the deal.

"We agree to be ambitious when considering services in the forthcoming FTA negotiations," said a joint statement by finance minister Nirmala Sitharaman and her UK counterpart Rishi Sunak.

Pointing out that services account for 71 per cent of UK's GDP and 54 per cent of India's, the statement released after

India-UK Economic and Financial Dialogue said both countries recognise the importance of services in their respective economies.

Meanwhile, the UK welcomes India on junking retrospective income taxation and raising the cap on foreign direct investment in insurance from 49 per cent to 74 per cent, besides removing the ownership and control requirements in the sector. It should be noted that Vodafone, which is one of the 17 companies embroiled in a retrospective taxation dispute with India, is a UK-based company.

The UK said junking of retrospective taxation will strengthen the business environment and is part of India's move on improving ease of doing business.

The UK requested the Indian finance minister for changes in the offer for participation for the reinsurance regulation so that all onshore reinsurers are given equal preference for participation in reinsurance placements.

On privatisation, the joint statement said the UK will work with DIPAM to share its experience through a series of workshops.

The two sides agreed to explore facilitating dual listing of green, social and sustainable bonds on the London Stock Exchange and Gift City exchanges.

Both sides agreed to build on RuPay cards and explore options for enhancing cross-border payments between the UK and India.