India-UK Deal To Promote, Textiles, Footwear, Pharma And Jewellery
Textiles and apparel will benefit from the removal of tariffs as it will enhance India’s competitiveness against countries like Bangladesh and Vietnam.
Chennai:The India-UK trade deal will benefit exports of textiles and apparels, leather and footwear, gems and jewellery, pharmaceuticals, and processed foods apart from boosting IT and professional services. On the other hand, India will lower tariffs, on cars, whiskey, gin, medical devices, aeronautical and electrical products as well as certain food products.
“The trade deal is a landmark step that will significantly boost bilateral trade, attract strategic investments, and further integrate Indian businesses into the global value chain,” said Federation of Indian Export Organisations.
The India–UK FTA eliminates or significantly reduces tariffs on a wide range of Indian goods, giving Indian exporters preferential access to one of the world’s most affluent and consumption-driven markets.
Textiles and apparel will benefit from the removal of tariffs as it will enhance India’s competitiveness against countries like Bangladesh and Vietnam. “In 2024, UK imported T&A products worth about $27 billion from across the world India is the 4th largest supplier with 6.6 per cent share,” said Chandrima Chatterjee, secretary general of CITI.
Leather and footwear will get increased access to high-end UK retail markets. Gems and jewellery exporters will get a boost for India’s handcrafted products and streamlined regulatory processes will accelerate generic pharmaceutical approvals.
The trade deal will also provide better access for value-added products, including tea, spices, fish, rice, and ready-to-eat segments.
“Products like textiles, footwear, carpets, cars and marine products are currently facing tariffs of 4 to 16 per cent,” said Ajay Srivastava, founder of GTRI.
It will also boost IT and Professional Service through mobility for professionals and reduced barriers for services exports, said S C Ralhan, President, FIEO. For professionals on short UK assignments, Double Contribution Convention has been included in the deal. The deal gives three-years exemption from social security payments for Indian employees working in the UK.
According to reports, tariffs on gin and whisky imports have been halved to 75 per cent. Tariffs on imported cars will fall from 100 per cent to 10 per cent and those on some food products like salmon, lamb, soft drinks, chocolate and biscuits, cosmetics, aerospace products, medical devices, electrical machinery will be lowered by India.
“But the deal’s true test lies in how the UK’s Carbon Border Adjustment Mechanism (CBAM) is handled. If Indian exports still face CBAM levies while UK goods enter India duty-free, it risks turning a balanced FTA into a one-sided bargain,” said Srivastava.
