India to leverage innovation, skilled workforce through UK trade deal: Ajay Bagga

The ongoing visit of the UK’s largest-ever delegation to India underscores the growing significance of the bilateral relationship, particularly as both nations seek to double trade by 2030. While optics suggest a strengthening partnership, the details of the Free Trade Agreement (FTA) reveal a more nuanced reality. Ajay Bagga, an expert on international trade, emphasized the critical nature of the partnership in an interview to ET Now. “Yes, it is quite critical for both countries and what is coming out now is that the FTA has got negotiated. So, we have moved from the negotiation to move towards ratification by both the parliaments and then implementation, so that is where we are at. So, it goes to vote in the UK parliament in a month from now. The visit is symbolically significant because we will have to see what comes out of the discussions between PM Modi and the UK Prime Minister.”

The agreement is expected to bring significant economic benefits. “It accords India a big success globally to be able to hold up this FTA as one model for the EU for other countries with 99.1% of Indian goods being de-tariffed, going at zero tariffs, I think it is a big accomplishment. The UK gains in terms of being able to export into India at much lower tariffs. There is talk of, for example, the Scottish Federation for the Scotch whiskey is talking about a thousand jobs increasing, thanks to the lower tariffs that they are expecting,” Bagga said.

However, visa restrictions remain a sticking point. Bagga noted, “No government can really throw open visas to a large population country and a large skilled force like India has. So, it is in their national interest. What has been pragmatic is that it has been compartmentalized. The mobility provisions provide for certain professions like chefs, yoga instructors, investors getting preferential visa access.”

The approach reflects a broader global trend. Bagga highlighted that while India negotiates with the EU as well, “It is a mirage to think that any country will open its borders in these very protectionist times to the hordes of skilled workers that India really provides. We have to seek capital, carveouts in terms of mobility for certain professions, and innovative technology and expertise to come into India.”

For India, the FTA promises not just tariff benefits but a stronger platform for labor-intensive industries, innovation, and service exports. With careful diplomacy and pragmatic planning, the partnership could serve as a model for balancing economic ambition with political realities.