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Exports

India's Chemical Exports to Get a Boost with UK-India Free Trade Agreement

Strategic Insights

— 1 min read

The newly signed Free Trade Agreement (FTA) between India and the United Kingdom is expected to significantly enhance India's chemical exports and domestic manufacturing, according to the Chemicals Export Promotion Council (CHEMEXCIL). The agreement provides zero-duty access to over 1,000 tariff lines from India's chemical sector in the UK market, including high-value categories such as organic and specialty chemicals. This preferential access is expected to boost India's trade competitiveness, bolster the sector's prominence in global trade policy frameworks, and promote supply chain collaboration.

Key Takeaways:

  • The FTA provides zero-duty access to over 1,000 tariff lines from India's chemical sector in the UK market, including high-value categories such as organic and specialty chemicals, agrochemicals, cosmetics and toiletries, essential oils, and petrochemicals.
  • India's chemical exports to the UK are expected to rise by 30-40 percent in the next financial year, potentially reaching USD 650-750 million in 2025-26.
  • The FTA could help Indian exporters expand their footprint in the UK's high-value market, with the UK's annual chemical imports standing at USD 35.11 billion.
  • The agreement is expected to promote supply chain collaboration, encourage joint ventures, facilitate technology transfer, and strengthen regulatory cooperation between the two countries.
  • India's current chemical exports to the UK stand at USD 570.32 million, representing around 2 percent of India's global chemical exports.

Statistics:

  • 12.4 percent of the total tariff lines under the trade agreement are from India's chemical sector.
  • USD 570.32 million: India's current chemical exports to the UK.
  • 2 percent: Share of India's global chemical exports to the UK.
  • USD 650-750 million: Potential exports to reach in 2025-26, as estimated by CHEMEXCIL.
  • USD 30 billion: India's annual chemical exports globally.
  • USD 35.11 billion: UK's annual chemical imports.

Sources:

  • [Chemicals Export Promotion Council (CHEMEXCIL)]

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