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In relief for Indian firms in UK, Britain to sign free trade deal with EU

As Britain works out its exit from the EU, chancellor of the exchequer Philip Hammond has said steps are being taken to address the fears of Indian firms that use the UK as their base to access European markets.

business Updated: Apr 04, 2017 21:02 IST
Suchetana Ray
Suchetana Ray
Hindustan Times, New Delhi
India-Britain relations,European Union,Brexit
Indian finance minister Arun Jaitley (right) and Britiain’s chancellor of the exchequer Philip Hammond shake hands ahead of a meeting in New Delhi on April 4, 2017. (AFP)

As Britain works out its divorce from the European Union (EU), chancellor of the exchequer Philip Hammond said on Tuesday that steps are being taken to address the fears of Indian firms which use the UK to access the European market.

“We will negotiate a free trade agreement with the EU, that will mean that goods originating in the UK will enter European markets freely and vice versa. I don’t believe that any of the Indian investments that we have till date will be put to risk,” Hammond told Hindustan Times.

Hammond is in New Delhi for the UK-India economic and financial dialogue aimed at promoting trade and investments between the two sides.

India is the third largest investor in the UK. If the trade deals with the EU do not materialise, it would mean goods originating from Britain would face entry tariffs, making them at least 10% costlier in Europe.

But given that the EU earns £100 billion more through goods sold in the UK than what Britain earns from sales into Europe, Hammond said he was confident of the trade deals going through.

He also brushed aside suggestions of new British visa restrictions affecting Indians. “The truth is that we issue more visas to Indians that all other nationalities put together. Sixty per cent of work visas issued by the UK go to Indians,” he said.

As India and the UK look at an FTA, Hammond assured there would be detailed discussions on visa issues. “Our migration approach has to move towards high-skilled professionals and that is what Indian companies also want,” he said.

The UK is among India’s major trading partners. In 2014-15, it ranked 18th in the list of India’s top 25 trading partners.

According to data from the commerce department, two-way merchandise trade during 2014-15 was worth $14.33 billion, marking a decrease of 9.39% when compared to 2013-14.

First Published: Apr 04, 2017 20:33 IST