2017

MM-16-20

Richa Seth

INDIA-UK TRADE RELATIONS

Analysis of Export-Import between the two countries
 India – UK Trade Relations

UK is among India’s major trading partners and the country ranked 18th in the list of India’s top
25 trading partners. The UK and India enjoy a strong trading relationship and is the largest G20
investor in India and in 2015-16 India was UK’s second biggest job creator. India was the third
largest investor in the UK and the second largest international job creator with Indian companies
having created over 110,000 jobs in the UK.

With the world’s largest young population and an ambitious reform agenda, there are huge
opportunities for UK businesses as the country has youth with skills, expertise and technology to
meet India’s demands.

India’s main exports to the UK are machinery, nuclear reactors, garments, footwear and textiles,
and instruments, petroleum products, footwear and leather, manufactures of metals, gems and
jewellery, engineering goods, transport equipment and parts, spices, drugs & pharmaceuticals
and marine products. The main imports from the UK to India are electrical machinery and
equipment, iron, steel, precious and semiprecious stones, silver, metals, aircrafts parts,
beverages and spirits, machinery, engineering goods, vehicles including tramway rolling stock
and parts thereof and other professional instruments other than electronics, non-ferrous metals
and chemicals.
The trade relations between India and UK was further strengthened with the visit of UK Prime
Minister Theresa May to India from November 6-8, 2016 was designed to further strengthen the
India–UK Strategic Partnership, guided by a shared vision for the future and supported by a
concrete and comprehensive roadmap of bilateral and global engagement.
The two Prime Ministers discussed all aspects of India-UK relations. The two leaders recalled the
strong bonds of friendship that exist between the two countries characterised by extensive
political engagement, deep economic co-operation, and ever expanding scientific and
technological collaboration.

TRADE WITH INDIA

The bilateral trade grew by 170% between 2004 and 2014. But India’s overall trade grew by 800%
in the same period. In more recent times, UK-India trade actually fell by around 8% in 2014-15;
India’s trade with Germany, Italy and France fell by even more that year.
The data only captures visible trade and don’t take into account the holistic nature of bilateral
trade. For example, global supply chains see aeroplane or car engines made in the UK that are
sent to France/Germany for assembly before being exported to India.
UK is among India’s major trading partners. During 2015-16, UK ranked 12th in the list of India’s
top 25 trading partners. Despite the global economic slowdown and the Eurozone crisis, India-
UK bilateral trade has been resilient.

India-UK Total Trade Statistics as on 04/01/2017

Export - Import between India & UK

12,000.00

10,000.00

8,000.00

6,000.00

4,000.00

2,000.00

0.00
2011-2012 2012-2013 2013-2014 2014-2015 2015-2016

EXPORT IMPORT

Source: Export Import Bank of India

Values in US $ Millions

2011- 2012- 2013- 2014- 2015-

S.No.
2012 2013 2014 2015 2016

1. EXPORT 8,589.93 8,612.54 9,779.07 9,319.73 8,828.71

2. %Growth 0.26 13.54 -4.70 -5.27
3. India's Total Export 305,963.92 300,400.58 314,405.30 310,338.48 262,290.13
4. %Growth -1.82 4.66 -1.29 -15.48
5. %Share 2.81 2.87 3.11 3.00 3.37
6. IMPORT 7,134.30 6,293.09 6,045.10 5,018.28 5,192.54
7. %Growth -11.79 -3.94 -16.99 3.47
8. India's Total Import 489,319.49 490,736.65 450,199.79 448,033.41 381,006.63
9. %Growth 0.29 -8.26 -0.48 -14.96
10. %Share 1.46 1.28 1.34 1.12 1.36
11. TOTAL TRADE 15,724.23 14,905.62 15,824.17 14,338.01 14,021.25
12. %Growth -5.21 6.16 -9.39 -2.21
13. India's Total Trade 795,283.41 791,137.23 764,605.09 758,371.89 643,296.75
14. %Growth -0.52 -3.35 -0.82 -15.17
15. %Share 1.98 1.88 2.07 1.89 2.18
16. TRADE BALANCE 1,455.63 2,319.45 3,733.98 4,301.46 3,636.18
17. India's Trade Balance - - - - -
183,355.57 190,336.07 135,794.49 137,694.93 118,716.50

Source: Export Import Bank of India

UK Exports India
700,000.00
600,000.00
500,000.00
400,000.00
300,000.00
200,000.00
100,000.00
0.00

ARTICLES OF APPAREL AND CLOTHING ACCESSORIES, NOT KNITTED OR CROCHETED.

ARTICLES OF APPAREL AND CLOTHING ACCESSORIES, KNITTED OR CORCHETED
NUCLEAR REACTORS, BOILERS, MACHINERY AND MECHANICAL APPLIANCES; PARTS THEREOF

Source: Export Import Bank of India

 UK Imports to India
2,000,000.00
1,500,000.00
1,000,000.00
500,000.00
0.00

ELECTRICAL MACHINERY AND EQUIPMENT AND PARTS THEREOF; SOUND

RECORDERS AND REPRODUCERS, TELEVISION IMAGE AND SOUND RECORDERS
AND REPRODUCERS,AND PARTS.
NATURAL OR CULTURED PEARLS,PRECIOUS OR SEMIPRECIOUS
STONES,PRE.METALS,CLAD WITH PRE.METAL AND ARTCLS
THEREOF;IMIT.JEWLRY;COIN.
IRON AND STEEL

Source: Export Import Bank of India

A comprehensive UK-India economic partnership will boost direct trade. However, Indian and UK
companies shouldn’t wait for an agreement to be reached; the opportunity is now.
Inter-Parliamentary Contacts: The Parliaments of India and the UK have close relations. There are
Friends of India Groups in the two major political parties (Labour and Conservative). There is an
All-Party Parliamentary Group on relations with India. Parliamentary exchanges have also taken
place under the banner of the Commonwealth Parliamentary Association. Trade: UK is among
India’s major trading partners and during the year 2014-15, UK. As per data published by
Department of Commerce, two-way merchandise trade during 2014-15 was US$14.33 billion,
marking a decrease of 9.39% as compared to 2013-14. UK’s share in India’s global trade has gone
down from 2.07% in 2013-14 to 1.89% in 2014-15.
India and the United Kingdom share close and friendly ties. The bilateral relationship that was
upgraded to a strategic partnership in 2004 was further strengthened with the visit of British
Prime Minister Cameron to India in 2010 during which the foundation for Enhanced Partnership
for the Future was laid. In his first term as Prime Minister, he visited India thrice viz. in 2010, in
February 2013 and again in November 2013 to reinforce UK Government’s commitment to
further relations with India.
India invests more in the UK than in the rest of the EU combined, while the UK is the biggest G20
investor in India.
Export
Sr. Commodities 2006-
No 2007 2007- 2008-
. 2008 2009 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17
ARTICLES OF APPAREL
AND CLOTHING
ACCESSORIES, NOT
KNITTED OR 271,417. 285,863. 310,918. 347,297. 383,916. 440,497. 440,497. 519,466. 593,174. 554,350.
1 CROCHETED. 00 54 18 62 31 08 08 58 584,434.43 34 34
ARTICLES OF APPAREL
AND CLOTHING
ACCESSORIES, KNITTED 156,757. 195,947. 283,020. 260,406. 215,430. 372,798. 372,798. 486,077. 586,611. 538,924.
2 OR CORCHETED 68 97 49 14 81 00 00 25 551,853.08 32 90
NUCLEAR REACTORS,
BOILERS, MACHINERY
AND MECHANICAL
APPLIANCES; PARTS 151,777. 167,519. 217,782. 156,426. 196,454. 290,887. 290,887. 331,492. 447,499. 461,117.
3 THEREOF 86 84 37 90 49 99 99 06 455,666.08 32 28
VEHICLES OTHER THAN
RAILWAY OR TRAMWAY
ROLLING STOCK, AND
PARTS AND
ACCESSORIES THEREOF.

66,053.2 66,600.3 114,254. 264,816. 202,723. 401,882. 401,882. 517,253. 344,877. 413,697.
4 0 5 30 98 61 33 33 64 336,823.46 21 53
NATURAL OR CULTURED
PEARLS,PRECIOUS OR
SEMIPRECIOUS
STONES,PRE.METALS,CL
AD WITH PRE.METAL
AND ARTCLS
THEREOF;IMIT.JEWLRY;C 132,726. 126,337. 259,602. 165,489. 159,230. 264,938. 264,938. 265,073. 352,909. 319,656.
5 OIN. 65 35 75 60 86 13 13 92 311,170.61 34 72
 PHARMACEUTICAL 61,326.7 268,804. 298,049.
PRODUCTS 8 62 69

82,818.1 86,813.9 127,274. 130,908. 208,603. 208,603. 242,307. 303,466.

6 8 6 17 22 27 27 97 19
FOOTWEAR, GAITERS 94,210.5
AND THE LIKE; PARTS OF 3 97,176.1 113,630. 140,643. 154,753. 217,357. 217,357. 259,556. 303,944. 311,525. 274,289.
7 SUCH ARTICLES. 4 47 99 15 54 54 60 58 18 37
ELECTRICAL MACHINERY 106,445.
AND EQUIPMENT AND 28
PARTS THEREOF; SOUND
RECORDERS AND
REPRODUCERS,
TELEVISION IMAGE AND
SOUND RECORDERS AND
REPRODUCERS,AND 121,572. 140,107. 132,807. 142,759. 221,604. 221,604. 246,467. 268,186. 240,896.
8 PARTS. 25 16 91 39 94 94 91 255,295.17 04 33
AIRCRAFT, SPACECRAFT, 14,463.8 40,398.6 49,128.3 68,630.4 137,758. 137,758. 71,596.6 104,356. 183,925.
9 AND PARTS THEREOF. 6,069.98 7 2 0 6 09 09 5 214,756.99 69 63
ARTICLES OF IRON OR 85,891.6 92,474.5 97,185.6 69,941.1 99,804.4 167,570. 167,570. 228,198. 228,024. 190,412. 169,758.
10 STEEL 0 3 3 5 5 71 71 77 86 11 41

Source: Export Import Bank of India

Import
Commodities 2006- 2007- 2008-
2007 2008 2009 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17
NUCLEAR REACTORS,
BOILERS, MACHINERY
AND MECHANICAL
APPLIANCES; PARTS 305,670. 388,949. 386,407. 301,215.1 356,891. 408,187.6 439,376. 385,772. 473,320. 388,001.
1 THEREOF. 67 96 65 9 17 6 06 47 427,684.89 37 54
 ELECTRICAL MACHINERY
AND EQUIPMENT AND
PARTS THEREOF; SOUND
RECORDERS AND
REPRODUCERS,
TELEVISION IMAGE AND
SOUND RECORDERS AND
REPRODUCERS,AND 129,526. 138,304. 176,179. 115,602.9 165,435. 187,905.6 202,866. 172,771. 223,385. 220,542.
2 PARTS. 92 40 55 4 19 4 63 27 189,459.24 96 81
NATURAL OR CULTURED
PEARLS,PRECIOUS OR
SEMIPRECIOUS
STONES,PRE.METALS,CLA
D WITH PRE.METAL AND
ARTCLS
THEREOF;IMIT.JEWLRY;C 750,196. 682,970. 986,526. 549,466.7 800,260. 1,238,074. 1,069,37 1,496,73 982,636. 194,805.
3 OIN. 83 47 01 8 54 75 9.45 5.68 708,711.16 89 54
IRON AND STEEL 82,887.1 82,008.3 222,465. 244,509.1 190,491. 329,959.0 413,418. 252,171. 260,079. 183,182.
4 7 2 66 2 14 3 97 88 294,799.93 52 86
OPTICAL, PHOTOGRAPHIC
CINEMATOGRAPHIC
MEASURING, CHECKING
PRECISION, MEDICAL OR
SURGICAL INST. AND
APPARATUS PARTS AND 69,415.0 83,677.4 87,194.2 91,614.8 121,910.5 147,855. 155,385. 174,021. 181,909.
5 ACCESSORIES THEREOF; 4 5 6 80,773.08 0 4 18 07 164,533.30 92 68
ALUMINIUM AND 164,351.
40,866.4 25,000.8 31,429.0 60,287.5 99,453.9 101,236. 139,583.
ARTICLES THEREOF. 26
6 3 5 6 39,896.89 1 93,059.09 1 58 135,432.11 95
BEVERAGES, SPIRITS AND 17,561.9 22,750.3 29,181.1 40,339.6 93,563.9 112,149. 134,215. 136,546.
7 VINEGAR. 9 5 6 25,621.91 4 66,555.23 4 98 131,131.19 40 21
PLASTIC AND ARTICLES 29,384.3 28,742.9 32,840.3 38,387.2 63,370.2 61,794.2 89,207.7 81,612.8
8 THEREOF. 4 2 8 39,633.12 0 48,821.21 8 9 76,739.02 5 7
VEHICLES OTHER THAN
RAILWAY OR TRAMWAY
ROLLING STOCK, AND
PARTS AND ACCESSORIES 12,079.4 15,383.3 73,084.2 79,317.8 58,471.8 77,110.8 71,706.6
9 THEREOF. 8,914.57 6 0 33,904.63 6 80,067.89 5 5 74,406.89 7 9
AIRCRAFT, SPACECRAFT,
1 34,146.9 40,285.3 40,578.3 40,394.2 106,754.6 51,140.4 30,868.4 109,707. 68,053.8
AND PARTS THEREOF.
0 8 7 9 60,556.72 5 1 1 8 40,192.59 81 8
References:

http://mea.gov.in/Portal/ForeignRelation/UK-Jan_2016_en.pdf

http://www.livemint.com/Opinion/tYnGlzIRl946XFhREE9CHL/The-prospects-of-UKIndia-economic-ties.html

http://www.telegraph.co.uk/news/2017/04/09/post-brexit-trade-deal-india-worth-extra-2-billion-british-economy/

https://www.gov.uk/government/news/uk-india-economic-and-trade-relations-to-take-centre-stage-on-two-day-visit