With UK Prime Minister Rishi Sunak demonstrating his confidence in securing a deal at the G20 summit last September, an FTA with India would have the potential to make trade with the world's fifth largest economy by GDP easier and cheaper, provided it involves a reduction in tariffs, which would in turn significantly bolster UK exports to India. Modelling from the Department for Business and Trade suggests projected trade with India could increase by 40-79 per cent by 2035, depending on the depth of the negotiated agreement. For many Scottish businesses with aspirations in India, planning is under way.

It is thought the key benefits of an FTA would include reduced barriers to trade in goods, increased opportunities for UK services exports, increased competitiveness for key UK products and access to a growing consumer base in India.

India was already Scotland's fifth top destination for goods (excluding oil and gas) for Q1-Q3 of 2022. An FTA could see India move further up the league table of trading partners.

A man speaks on a mobile phone near the seafront overlooking the city skyline in Mumbai. Modelling from the Department for Business and Trade suggests projected trade with India could increase by 40-79 per cent by 2035 (Picture: Punit Paranjpe PUNIT/AFP via Getty Images)

From discussions with clients, we see particular opportunities in financial services, engineering and manufacturing, telecoms and digital, and for service companies who can support India with its energy transition objectives and strategy. In addition, with India's middle class population expected to increase to 60 million by 2030, and to 250 million by 2050, this could create significant opportunity for Scottish firms with high-quality brands and products to sell, including whisky.

Indeed, the reduction of the existing 150 per cent tariff on Scotch whisky being exported to India would have a significant effect on future exports, with the potential for a dramatic increase, particularly for some of the smaller whisky producers who currently feel locked out of the market due to the higher costs of doing business. Dentons advises a number of whisky companies and sees growing enthusiasm about the potential for increased trade with India from various distillers and industry bodies.

As with exploring any new market, understanding the legal position will be key, not only for providing certainty in doing business and managing risk, but also for maximising strategic opportunities. So, whether establishing a new office, negotiating a contract or distribution agreement, executing an M&A transaction, arranging financing, resolving a dispute, protecting IP or understanding local employment laws, having excellent legal advice and advisers on the ground who understand the domestic Indian market will be crucial. We are seeing an increasing number of enquiries from Scottish companies looking for this support.

So, whilst many Scottish businesses have been advancing their India plans, Dentons has been doing the same, joining forces with Indian law firm, Link Legal, to provide "first mover advantage" and make Dentons the first global law firm to combine with a law firm in India. Dentons Link Legal, as it is now known, has more than 150 lawyers and over 40 partners, with a presence in five of India’s six largest cities.

Stuart Fitzsimmons is a Partner, Dentons (Picture: Graham Clark)

This kind of collaboration will be key across all sectors looking to take advantage of the benefits of an FTA and to execute business plans in India. While the immediate outcome of trade talks may rely on the results of forthcoming elections in both countries, enthusiasm is building for the opportunities ahead, as enhanced activity with the Indian market rolls onto and up the agenda for many company boards in Scotland.

Stuart Fitzsimmons is a Partner, Dentons

Scottish business could take chance on huge Indian opportunities - Stuart Fitzsimmons

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