India-UK CETA: Let's not forget all we gave up to secure the deal

New Delhi made concessions that may not just hurt but also set a template for future agreements

- ABHIJIT DAS

Most reports on the recently signed Comprehensive Economic and Trade Agreement (CETA) between India and the UK have focused on positive aspects of the agreement. But the CETA, as with any negotiated outcome, is also a compromise between the competing interests of the two countries. It is therefore important to understand the possible implications for India. Here are some key takeaways from this trade pact.

First, with the UK eliminating customs duties on almost 99% of India's exports, significant opportunities would open up for labour-intensive sectors such as textiles and clothing, gems and jewellery and leather products, which currently face 4-16% duty. This will provide an edge for these exports over competitors from Bangladesh, China and Vietnam. However, an increase in India's exports of manufactured products would depend on the UK not imposing a carbon tax. The ability of exporters in labour-intensive sectors to scale up production of high-end products and comply with sustainability requirements will also be key.