Prime Minister Narendra Modi announced the conclusion of a Historic Free Trade Agreement (FTA) with the United Kingdom (UK), This agreement aims to deepen the Comprehensive Strategic Partnership for Bilateral trade between India and the UK.
India and the United Kingdom has fixed a bilateral trade agreement between the two countries on Tuesday amid the current trade tariff imposed by the United State, both countries has decided to lowering tariffs on key exports such as U.K. whisky and cars.
On the social media platform X Indian Prime Minister Narendra Modi wrote “Delighted to speak with my friend PM @Keir_Starmer. . In a historic milestone, India and the UK have successfully concluded an ambitious and mutually beneficial Free Trade Agreement, along with a Double Contribution Convention. These landmark agreements will further deepen our Comprehensive Strategic Partnership, and catalyse trade, investment, growth, job creation, and innovation in both our economies. I look forward to welcoming PM Starmer to India soon.”
According to the British Government “Its fully tariff free within a decade”. As per this deal India will gradually lower the taxes on imports from UK. Vast majority of goods will cover under this agreement.
The British government also said that the deal “is expected to increase bilateral trade by 25.5 billion pounds ($34 Billion), UK GDP by 4.8 billion pounds ($6.4 Billion) and wages by 2.2 billion pounds ($2.9 Billion) each year in the long run”
Exports from the U.K to India included liquor such as whisky and gin, The current tariffs will be halved from 150% to 75% within the decade and final tariff will be 40% approximately under the agreement. Meanwhile, but in automotive segment tariffs will be cut sharply from over 100% to 10% on some products, UK government added.
This historic trade agreement between India and the U.K. comes amidst the rising trade tensions globally imposed and raised by the U.S. President Donald Trump on imports worldwide, straining relations with US allies and other countries.
Under current agreement tariffs will also be reduced on British exports which includes medical devices, aerospace parts, cosmetics, chocolate, Biscuits, lamb and salmon.
India’s Trade Ministry claims 99 % of Indian export goods would face no import duty under the deal in this trade agreement.
Indian Trade Minister Piyush Goyal said “This brings us closer to our goal of becoming a global economic powerhouse. It protects our core interests while opening doors to India’s greater participation in global value chains,”
Under the provision of this deal a “Double Contribution Convention” introduced, that exempts Indian workers in the UK from national insurance payments for up to 3 years, and vice versa.
