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Trade agreements

India and UK Ink Comprehensive Economic and Trade Agreement (FTA) to Boost Bilateral Trade

Strategic Insights

— 2 min read

Prime Minister Narendra Modi hailed the Comprehensive Economic and Trade Agreement (FTA) signed by India and the UK as a "milestone moment" in bilateral relations, expected to boost trade by around $34 billion annually. The FTA is a significant step towards strengthening economic ties between the two nations, providing duty-free access to various Indian exports, and making it easier for British firms to export their products to India.

Key Takeaways:

  • The Comprehensive Economic and Trade Agreement (FTA) between India and the UK is expected to boost bilateral trade by around $34 billion annually.
  • The FTA will benefit 99% of Indian exports by reducing tariffs, making it easier for British firms to export whisky, cars, and other products to India.
  • Indian professionals can work in 35 UK sectors for 24 months, even without an office in the country, and will be exempt from UK social security payments for three years.
  • The FTA will provide duty-free access to several domestic sectors such as leather, electrical machinery, and chemicals in the British market.
  • India's talent in IT, services, and education will gain from easier access to the UK's high-value markets and will make it more affordable for Indians to live in the UK.
  • Indian firms and freelancers will have access to 36 service sectors in the UK with no 'Economic Needs Test'.
  • The UK said Indian consumers will benefit from improved access to the best British products, including soft drinks, cosmetics, cars, and medical devices.
  • Exports such as shrimp, tuna, fishmeal, and feeds, which currently attract duties ranging from 4.2% to 8.5% in the UK, will now be able to access the British market duty-free.
  • The FTA will also provide significant benefits to India's agriculture sector, including duty-free access to coconuts, mango pulp, and other processed agricultural products.

Statistics:

  • Bilateral trade between India and the UK is expected to increase by around $34 billion annually.
  • 99% of Indian exports will benefit from reduced tariffs under the FTA.
  • 35 UK sectors will be open to Indian professionals for 24 months without an office in the country.
  • Indian professionals will be exempt from UK social security payments for three years.
  • 36 service sectors in the UK will be accessible to Indian firms and freelancers with no 'Economic Needs Test'.
  • The FTA is expected to boost economic activity and create many more jobs and opportunities for entrepreneurship in both countries.
  • The UK said the deal will bring huge benefits to both countries, boosting wages, raising living standards, and putting more money in the pockets of working people.

Sources:

  • PTI
  • ABP Private Limited
  • Contify.com

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