Cabinet approves India-UK free trade agreement, to be signed during PM Modi’s UK visit

The cabinet on Tuesday approved the free trade agreement between India and the UK, which will be signed in London on July 24, sources said.

The pact, officially called as comprehensive economic and trade agreement, will be signed during Prime Minister Narendra Modi's visit to London.

Modi's four-day visit to the United Kingdom and the Maldives begins on Wednesday.

Commerce and Industry Minister Piyush Goyal will accompany the prime minister.

The two countries announced the conclusion of the negotiations for the trade agreement on May 6.

The trade pact proposes to remove taxes on the export of labour-intensive products such as leather, footwear and clothing, while making imports of whisky and cars from Britain cheaper, in a bid to double the trade between the two economies to USD 120 billion by 2030.

The pact has chapters on issues including goods, services, innovation, government procurement, and intellectual property rights.

The text of the agreement is generally signed by the commerce ministers from both countries.

Once the free trade agreement is signed, it will require approval from the British Parliament before it can take effect.

The two countries have also concluded the negotiations for the Double Contribution Convention Agreement, or social security pact. It would help avoid double contribution to social security funds by Indian professionals working for a limited period in Britain.

However, the talks for the bilateral investment treaty (BIT) are still going on.

The FTA comes into force after signing and ratification by both the countries.