India Opens Liquor, Autos to UK, Gains Goods Access

Trade deal aims to enhance economic ties, targets $120 billion in trade by 2030

- Dhirendra Kumar

Cosmetics, chocolates, medical devices and aerospace goods from the UK are set to become sharply cheaper in India after the two countries signed a landmark trade deal on Thursday, while Indian seafood, textiles, leather footwear, and gems and jewellery get to enter the UK duty-free.

Lovers of Scotch whiskey and imported cars have reason to cheer too, though the duty benefits will unroll over the years—and in the case of automobiles, there will be stiff quotas on how many vehicles can be imported at lower duty, after which regular tariffs kick in.

The pact kept out the UK's contentious carbon border tax, as well as post-study work visas for Indian students in the UK. On professionals moving between the two countries too, the liberalization was modest. The agreement marks a significant reset in bilateral economic relations, and unveils an ambitious joint roadmap for cooperation through 2035.

The India-UK Comprehensive Economic and Trade Agreement (CETA) is among the most wide-ranging deals ever concluded by India, and the most expansive trade pact signed by the UK in the Indo-Pacific after it left the European Union. The deal takes effect once both parliaments ratify it, which may take six months or more.

Both Prime Minister Narendra Modi and UK Prime Minister Keir Starmer described the deal as a win for their nations.

Nearly 45% of India's exports to the UK will now enter duty-free, offering a significant boost to India's labour-intensive sectors. Tariffs on Indian processed food falls from 70% to zero, making them sharply cheaper in the UK.