Lot of 'merit' in negotiating separate FTA with UK: CII

With Britain deciding to exit the European Union, there is a lot of "merit" in negotiating a separate free trade agreement with the UK, CII President Naushad Forbes said.

"Now, we could do a probably very quick and easy free trade agreement (FTA) with the UK because our interests are very complementary, and the sectors which were considered sensitive (in India-EU FTA negotiations) are not sensitive in India-UK trade," he said.

There are lot of export opportunities for Indian companies in sectors including garments and textiles in Britain, he added.

"So, there is a lot of merit in India-UK FTA. It could probably happen faster than the India-EU free trade agreement," he said.

However, India should also pursue the ongoing negotiations for a comprehensive free trade pact with the EU as it is in the country's interest, he added.

Launched in June 2007, the negotiations for the proposed Broad-based Trade and Investment Agreement (BTIA) between India and the EU have seen many hurdles with both sides having major differences on crucial issues like intellectual property rights, duty cut in automobile and spirits, and liberal visa regime.

When asked whether Brexit has raised questions over India-EU FTA, Forbes said: "It has raised questions in a rather interesting way, which is that, we may end up with an Indo-UK FTA faster." Before starting formal negotiations for a free trade agreement, two trading partners normally carry out a feasibility study.

The bilateral trade between the two countries stood at USD 14 billion in 2015-16, down from USD 14.33 billion in the previous fiscal.

The UK is also the third largest investor in India. The country has received USD 23.10 billion foreign direct investments from the UK during April 2000 and March 2016. It is 8 per cent of India's total FDI during this period.