FTA with India a smart approach to trade, says UK’s new Industrial Strategy

London: The UK government released a new industrial strategy on Monday for boosting investment to spur economic growth and termed the recently concluded Free Trade Agreement (FTA) with India a smart approach to foster free and open trading relations.

The UK’s Modern Industrial Strategy sets out a 10-year plan to lure investments and create skilled jobs with the aim of making Britain the best place to do business.

British Prime Minister Keir Starmer notes in his foreword that the strategy provides a 'new approach for a new era', with the UK positioning itself as an "unashamed champion of global trade", as recent FTAs with countries like India show.

"International trade and investment play a crucial role in driving economic growth, but the global landscape is changing," reads the trade section of the new strategy.

"Government must be pragmatic, agile, and smart in navigating this environment. We will engage strategically with a wide range of partners, using the most modern trade tools, helping businesses to export and attract investment, building resilience through cooperation and being assertive about our own interests and the importance of a rules-based international system, upholding the principles of open and free trade," it said.

"We have showcased this approach through our new deals with the US, EU, India, Japan and our engagement with China...Our Free Trade Agreement with India, by reducing barriers and supporting opportunities across high-growth sectors, will increase bilateral trade by GBP 25.5 billion each year in the long run." The India-UK FTA talks concluded last month, with Commerce and Industry Minister Piyush Goyal in London last week to discuss the next steps towards its implementation process, which requires parliamentary clearance in the UK.

"We in India have a much faster process, comparatively, so we'll be ready as soon as the legal scrubbing is done and the document is sorted out," Goyal said.

Among the highlights of the UK’s new Industrial Strategy are a high growth sector-specific approach and a reduction of electricity costs by up to 25 per cent from 2027 for electricity-intensive manufacturers in such sectors to bring costs more closely in line with other major economies in Europe.

"This Industrial Strategy marks a turning point for Britain’s economy and a clear break from the short-termism and sticking plasters of the past," Starmer said in a statement.

"This is how we power Britain's future - by backing the sectors where we lead, removing the barriers that hold us back, and setting out a clear path to build a stronger economy that works for working people. Our message is clear – Britain is back and open for business," he said.

The plan focuses on eight sectors where the UK is already strong and offers potential for faster growth: Advanced Manufacturing, Clean Energy Industries, Creative Industries, Defence, Digital and Technologies, Financial Services, Life Sciences, and Professional and Business Services.

Each growth sector has a bespoke 10-year plan that will attract investment, enable growth and create high-quality jobs.

UK Business and Trade Secretary Jonathan Reynolds said: "Our Modern Industrial Strategy will ensure the UK is the best country to invest and do business, delivering economic growth that puts more money in people’s pockets and pays for our NHS, schools and military.

"Not only does this Strategy prioritise investment to attract billions for new business sites, cutting-edge research, and better transport links, it will also make our industrial electricity prices more competitive." The stated ambition of the new 10-year plan is that it would make it quicker, easier and cheaper to do business in the UK, giving businesses the confidence to invest and create 1.1 million well-paid jobs in thriving industries.