The India–UK Free Trade Agreement (FTA) officially came into force on Tuesday, marking a significant milestone in the economic partnership between the two countries. Describing it as a landmark pact, UK High Commissioner to India Lindy Cameron said the agreement is expected to substantially boost trade, investment, and business opportunities while laying the groundwork for a stronger bilateral relationship in the years ahead.
According to Cameron, the agreement builds on an existing bilateral trade relationship valued at £48 billion. Over the long term, it is projected to increase annual trade between the two countries by £25 billion and contribute approximately £5 billion to the UK’s GDP each year.
WIDER MARKET ACCESS FOR BUSINESSES
The agreement provides duty-free or reduced-tariff access for a significant proportion of goods traded between India and the UK. Cameron said that around 99 per cent of Indian exports to the UK and 90 per cent of UK exports to India will either become tariff-free or benefit from lower import duties.
She described the pact as one of the UK’s most comprehensive trade agreements, comprising 30 chapters covering trade in goods and services, government procurement, and several other areas of economic cooperation.
According to Cameron, the agreement is expected to create opportunities across a broad range of sectors while making a number of British products more affordable for Indian consumers.
LOWER DUTIES ON KEY UK PRODUCTS
Among the major tariff reductions, the import duty on Scotch whisky has been cut from 150 per cent to 75 per cent, while the duty on premium British automobiles has been reduced from 110 per cent to 10 per cent.
Cameron said Indian consumers are also likely to benefit from lower prices on various British products, including cosmetics, beauty products, and sporting goods.
She added that the agreement creates new opportunities in sectors such as renewable energy by facilitating easier trade in turbines, generators, and related equipment. Indian animation studios and game developers are also expected to benefit from stronger intellectual property protection when collaborating with UK-based companies.
GREATER OPPORTUNITIES FOR BUSINESSES AND PROFESSIONALS
The agreement also seeks to improve access to government procurement markets. Cameron said British companies will find it easier to participate in India’s government procurement market, which is estimated to be worth around £38 billion annually.
The pact also addresses professional mobility, making it easier for engineers, consultants, and other service professionals to work across both countries.
Cameron described the nearly 2,000-page agreement as a comprehensive framework that extends well beyond the scope of a conventional trade deal.
DOUBLE CONTRIBUTION CONVENTION NOW IN FORCE
Alongside the FTA, the Double Contribution Convention (DCC) has also come into effect.
Cameron explained that the DCC is a separate agreement designed to prevent businesses and employees on temporary overseas assignments from having to make social security contributions in both countries simultaneously.
A MILESTONE AFTER PROLONGED NEGOTIATIONS
Reflecting on the negotiations, Cameron acknowledged that the discussions were complex but said both governments remained committed to securing a comprehensive agreement rather than opting for a limited arrangement.
She noted that negotiators from both sides worked through several challenging issues to ensure that the final agreement delivered broad-based benefits across multiple sectors.
Commenting on the UK’s proposed Carbon Border Adjustment Mechanism (CBAM), Cameron said the policy is intended to support the country’s industrial decarbonisation objectives and should not be viewed as a trade measure.
A FOUNDATION FOR DEEPER PARTNERSHIP
Describing India as a future global economic powerhouse, Cameron said the agreement reflects the strong level of trust and cooperation between the two countries.
She characterised the India–UK Free Trade Agreement as a "new gold standard" for trade agreements, emphasising that it should be regarded as the beginning of a deeper partnership rather than its culmination.
According to Cameron, the agreement is not the upper limit of India–UK cooperation but a foundation on which both nations can expand collaboration across trade, investment, services, and emerging sectors in the years ahead.
