New Delhi: India’s landmark free trade pact with the UK will benefit it significantly as the deal will ensure the elimination of tariffs on approximately 99 per cent of tariff lines, covering nearly 100 per cent of the trade value, people familiar with the matter said Thursday.
The free trade agreement (FTA) is also set to make it easier for British firms to export whisky, cars and other products to India, besides boosting the overall trade basket.
Agriculture and allied sectors stand out as major beneficiaries, with Indian farmers gaining market access for high-value products like vegetables, fruits, basmati rice, cereals, animal products, beverages, oil seeds, and dairy, the people said.
The pact directly supports India’s ambitious goal of achieving USD 100 billion in agri exports by 2030, they added.
The FTA, billed as the UK’s most economically significant bilateral trade deal since leaving the European Union, will be signed shortly in the presence of Prime Minister Narendra Modi and his British counterpart, Keir Starmer.
In key labour-intensive sectors, duties have been reduced to zero from previously high levels of up to 20 per cent on marine products, 12 per cent on textiles and clothing, 8 per cent on chemicals, and 10 per cent on base metals, the people cited above said.
Notably, in the processed food sector, tariffs on 99.7 per cent of lines have been slashed from as high as 70 per cent to zero, offering a major boost for Indian exporters, they said.
The trade deal, firm up after three years of negotiations, is expected to ensure comprehensive market access for Indian goods across all sectors, including in the agricultural domain.
It offers a transformative opportunity for businesses across key sectors such as agriculture, food processing, chemicals, pharmaceuticals, textiles, engineering goods, electronics, and marine products, the people said.
They said the agriculture sector is set to benefit significantly.
In agriculture, India exports USD 36.63 billion globally, while the UK imports USD 37.52 billion, but imports just USD 811 million from India, revealing room for growth in high-value agri products, they noted.
The UK is a high-value market for niche Indian agri-products such as tea, mangoes, grapes, spices, marine products, etc.
The India-UK FTA will allow Indian farmers to fetch premium prices for these products in the UK market, the people said, adding the trade pact will deliver a “seismic shift”, granting Indian agri-products parity with major EU exporters like Germany and the Netherlands, which currently enjoy zero tariffs.
PTI
