From Cars And Chocolates To Scotch And Salmon: What Gets Cheaper With India-UK Trade Deal
On Thursday, the India-UK Free Trade Agreement was signed and formalised, during Prime Minister Narendra Modi's visit to the UK, where he met his counterpart Keir Starmer.
- Date & Time:
- |
- Views: 82
- |
- From: India News Bull
The India-UK Free Trade Agreement was officially signed during Prime Minister Narendra Modi's visit to the UK, where he met with Prime Minister Keir Starmer. Commerce Minister Piyush Goyal and British counterpart Jonathan Reynold formalized the agreement on Thursday.
This trade deal, which had been under negotiation for three years, is projected to enhance bilateral trade between the two nations by $34 billion annually.
For India, the FTA presents substantial advantages by creating new growth opportunities, enhancing skill development, and generating employment across multiple sectors.
The agreement will benefit Indian youth seeking careers in information technology, financial services, professional services, management consultancy, architectural and engineering fields, while also supporting young entrepreneurs and Indian graduates pursuing UK career opportunities.
Prime Minister Starmer stated, "Our landmark trade deal with India is a major win for Britain. It will create thousands of British jobs across the UK, unlock new opportunities for businesses and drive growth in every corner of the country, delivering on our Plan for Change."
Additionally, 26 British companies have announced new business ventures in India.
Under this agreement, Indian industries and consumers will gain access to medical devices, aerospace parts imported from the UK at reduced costs.
British products including soft drinks, cosmetics, chocolates, biscuits, lamb, salmon, and automobiles will become more accessible to Indians as average tariffs decrease from 15 percent to 3 percent once the FTA takes effect. Electric vehicles will see significant tariff reductions from 110 percent to 10 percent within a quota.
The trade deal will facilitate British firms' exports to India, particularly whisky, which will see import duties reduced from 150 percent to 75 percent immediately and further to 40 percent over a decade.
Beyond products, the agreement facilitates Indian citizens' ability to live in the UK, with firms and freelancers gaining access to 36 service sectors without requiring an 'Economic Needs Test'.
Indian professionals will be permitted to work in 35 UK sectors for 2 years without establishing an office in the country. According to the commerce ministry, this could benefit more than 60,000 IT professionals annually, with major beneficiaries including TCS, Infosys, Tech Mahindra, HCL Technologies, and Wipro.
The agreement also exempts Indian professionals from UK social security payments for 3 years.
Additionally, the deal supports professionals such as chefs, yoga teachers, musicians, and other contract-based workers by facilitating their entry into the UK job market.
For the UK, the agreement will result in significant reductions in Indian tariffs across 90 percent of tariff lines, with 85 percent becoming exempt within a decade.
UK businesses will secure expanded access to Indian public procurement opportunities, enabling British companies to bid on non-sensitive government tenders valued above Rs 2 billion. This potentially allows UK participation in approximately 40,000 tenders annually, worth around Rs 4.09 lakh crore.
The UK anticipates creating over 2,200 jobs directly from this trade agreement.
British workers can expect wage increases totaling up to 2.2 billion pounds annually.
UK consumers will benefit from lower prices and greater choices on clothing, footwear, and food products.