AGREEING TO MIND THEIR DUTIES

Although it took long in coming, the India-UK Free Trade Agreement (FTA) endorses India's growing stature as a manufacturing and export powerhouse, while strengthening its position in the global supply chain

- By ASHISH SINHA

MAY 6, 2025 has etched itself as a red-letter day in the life of a resurgent India, and how! By day that day, India and the UK concluded the talks on a trade deal that was under discussion for more than three years. And by night, India unleashed its military might by pounding multiple terror hideouts deep inside Pakistan, in response to the April 22 gunning down of tourists in Pahalgam by Pakistan-based terrorists, and as a deterrent to future terror attacks.

The gains for India from these two events are vast and varied, especially from the India-UK Free Trade Agreement (FTA), which promises to create a level playing field for Indian exporters, bolster domestic manufacturing, and generate millions of jobs while streamlining services trade and enhancing labour mobility through a vital social security pact. But while the path ahead looks promising, it also demands vision, preparedness, and execution.

Commerce Minister Piyush Goyal said: “The historic India-UK FTA is a forward-looking agreement that opens new avenues for growth, fosters innovation, and strengthens India's position in global supply chains." The deal, as per an analysis of UK-India trade data, includes tariff cuts worth over $500 million (Rs 4,175 crore), based on 2022 trade data. India will reduce tariffs on 90 per cent of British product lines, including automobiles (from 100 per cent to 10 per cent), whiskey and gin (from 150 per cent to 40 per cent over 10 years), and other key sectors such as aerospace, medical devices, cosmetics, and food products. According to the agreement, 99 per cent of Indian tariff lines, representing nearly the entire trade value-will enjoy duty-free access to the UK market. Currently, most of the products face import duties from 4 per cent to 18 per cent in the UK.