India-UK Vision 2035

The Indian Prime Minister's visit to London was indeed a significant diplomatic milestone, as it unveiled the India–UK Vision 2035 roadmap and formalized the Comprehensive Economic and Trade Agreement (CETA). This Free Trade Agreement (FTA) is aimed at elevating the strategic partnership between India and the United Kingdom

Key Features of the India-UK Vision 2035

1. Trade and Economic Cooperation:

   • CETA (Comprehensive Economic and Trade Agreement) is central to the Vision 2035.

   • Aimed to increase bilateral trade and create jobs.

   • Joint Economic and Trade Committee (JETCO) will oversee implementation, with plans for a Bilateral Investment Treaty (BIT).

2. Technology and Innovation:

   • Focus on next-gen technologies like AI, quantum computing, telecom, and critical minerals.

   • Technology Security Initiative (TSI) will be launched for collaboration on these sectors.

3. Defense Cooperation:

   • A 10-year defense industrial roadmap will focus on joint research and manufacturing in key areas like jet engine technology, maritime security, and directed energy weapons.

   • India’s role in logistics in the Indian Ocean Region and collaboration under the Indo-Pacific Oceans' Initiative (IPOI).

4. Climate and Sustainability:

   • Collaboration on green finance, offshore wind, nuclear technologies, and green supply chains.

   • Platforms like International Solar Alliance and Coalition for Disaster Resilient Infrastructure will support these efforts.

5. Education and Skills:

   • Focus on establishing UK university campuses in India.

   • Emphasis on Mutual Recognition of Qualifications and Green Skills Partnership for climate-linked job creation.

6. Global Governance:

   • Both countries reaffirm commitment to multilateralism and push for reforms in international institutions like the UN, WTO, IMF, and the World Bank.

Key Highlights of the India-UK CETA

1. Duty-Free Access:

   • 99% duty-free access for India to the UK market, particularly for sectors like textiles, leather, marine products, electric and hybrid vehicles, and auto components.

   • Elimination of tariffs on UK electric vehicles within six years of the agreement.

2. Services Sector:

   • Expanded market access for Indian professionals and companies in sectors like IT, financial services, education, and more.

   • Simplified visa processes for sectors like engineering, architecture, and hospitality.

3. Double Contribution Convention:

   • Exempts Indian professionals and their employers from UK social security contributions for three years, improving competitiveness for Indian talent.

4. Inclusive Growth:

   • Promotes participation from women, youth, MSMEs, farmers, and innovators in global value chains.

5. Agricultural Benefits:

   • Indian agricultural exports such as processed foods, edible oils, and seafood will benefit from tariff reductions.

Impact of India-UK CETA

• Trade Expansion:

  • The agreement aims to double bilateral trade by 2030, potentially reaching USD 112 billion in combined goods and services.

  • Projected increase in UK exports to India by 60% by 2040.

• Job Creation:

  • The CETA will drive job creation in manufacturing, services, and agriculture sectors in both countries.

• Increased Investment:

  • By encouraging MSMEs, startups, and entrepreneurs, the CETA is expected to increase investment flows between India and the UK.

How India-UK Relations Have Evolved

1. Trade & Investment:

   • Bilateral trade reached USD 21.34 billion in 2023–24, with India's exports to the UK growing by 12.6% to USD 14.5 billion in 2024–25.

   • Technology & Innovation: The India–UK Technology Security Initiative (TSI) focuses on AI, semiconductors, and cybersecurity.

2. Defense & Security:

   • Strengthened defense cooperation through joint exercises like Konkan, Cobra Warrior, and Ajeya Warrior, with an emphasis on Indo-Pacific and defense tech.

3. Health Collaboration:

   • During the Covid-19 pandemic, India and the UK collaborated on the AstraZeneca-Serum Institute vaccine partnership.

4. Indian Diaspora:

   • The UK is home to 1.86 million people of Indian origin, who contribute significantly to science, arts, business, and politics.

Key Areas of Friction Between India and the UK

1. Extradition Issues:

   • India’s accusations of the UK sheltering fugitives like Vijay Mallya.

2. Russia-Ukraine War:

   • India’s neutral stance contrasts with the UK’s strong support for Ukraine, leading to strategic discomfort.

3. Climate Tariffs:

   • The UK’s Carbon Border Adjustment Mechanism (CBAM) may harm Indian exports, especially in steel, which India perceives as protectionism.

4. Khalistani Activities:

   • Pro-Khalistani protests in the UK strain diplomatic relations. India seeks stronger action against such groups.

5. Intellectual Property Rights:

   • Conflicts arise over IP protection, with the UK pushing for stricter rules while India seeks affordable medicines and more flexible innovation rules.

Steps India Can Take to Strengthen India-UK Ties

1. Deepen Security Ties:

   • Expand cooperation in Indo-Pacific, counterterrorism, and cyber defense through forums like AUKUS.

2. Joint Climate Action:

   • Collaborate on clean energy, sustainable agriculture, and green innovation.

3. Trade & Investment Diplomacy:

   • Promote India as a Global Capability Centre (GCC) hub and expand market access to drive investment.

4. Leverage the Indian Diaspora:

   • Engage the Indian community in the UK for political, cultural, and economic outreach.

Conclusion

The India-UK Vision 2035 and CETA are pivotal in strengthening strategic, economic, and technological ties between the two nations. These agreements pave the way for collaborative opportunities in trade, innovation, defense, and climate action. By addressing policy differences and focusing on diplomatic engagement, both nations can foster a robust, future-ready partnership.