UK FTA talks revolve around time-bound dispute resolution – Economy News

India and the UK are discussing possible options to address investors’ disputes in a time-bound manner through a domestic judicial mechanism in the proposed Bilateral Investment Treaty (BIT), a move that crucial for the conclusion of the much-awaited Free Trade Agreement (FTA) in the next few weeks, a senior official told FE.

India and the UK want to sign the FTA and BIT together as both complement each other for a comprehensive economic partnership between New Delhi and London.

The discussions turned out to be sticky with regard to India’s position that foreign investors have to exhaust domestic legal remedies before going for international arbitration. The UK’s concern was that Indian courts often take years to decide on cases, which could adversely impact investors.

The other sticky issue is over the Rules of Origin given the fears in India that Chinese goods could be routed through the UK as Chinese companies were gradually increasing their presence in the UK industry.

 The ongoing discussion, sources said, is about having a time limit on resolving disputes in India before these could proceed for international arbitration. However, there were fears whether the independent Indian judiciary would abide by any time frame specified in BIT. Deliberations are on to find a solution, the official added.

Recently, EU trade commissioner Valdis Dombrovskis suggested the establishment of special courts to resolve disputes involving violation of investment protection agreements to provide comfort to investors putting their money in India. India is also in talks for an FTA with the EU.

In the services sector, the differences have been broadly agreed upon on the lines of the UK’s FTA with Australia which came into force from May 2023, another official said. India would benefit significantly from the mobility of professionals in the proposed FTA with the UK,” the second official said.

In the services sector, the UK demanded national treatment for its services businesses and greater freedom for its professionals to operate in India. National treatment means treating foreigners and locals equally with regard to rules and regulations.

In FTA with the UK, Australia has secured ambitious commitments on the mutual recognition of professional qualifications and providing greater certainty for skilled professionals entering the UK labour market.

There has been no break or let up in negotiations on the India-UK free trade agreement and the 13th round of talks that began in September still continues.

There are 26 chapters in the agreement, which include goods, services, investments and intellectual property rights.