India, UK sign milestone bilateral trade agreement
New Delhi, July 25 -- India and the United Kingdom (UK) on Thursday signed a free trade deal, the Comprehensive Economic and Trade Agreement (CETA), with London permitting temporary business mobility for Indian professionals and New Delhi allowing concessions access to British automobiles and agri-food items, while keeping sensitive sectors such as dairy, apples and edible oils in the negative list.
The free trade agreement (FTA) may see a doubling of the bilateral trade from the current level of $56 billion by 2030. The deal will eliminate tariffs on approximately 99% of the tariff lines, covering almost 100% of the trade value. The UK will gain duty-free access for its 90% tariff lines that will cover 92% of existing merchandise imports from the country.
After the formal signing of the deal, Prime Minister Narendra Modi said: "We are committed to building a high-scoring, solid partnership." He is in London to endorse the signing of the deal.
"A landmark deal with India means jobs, investment, and growth here in the UK," UK Prime Minister Keir Starmer said.
Business mobility was one of the most sensitive issues for the UK during the bilateral negotiations, as were automobiles, the dairy and agriculture sector for India. "Easy business mobility will help India to boost its services trade in one of the biggest European markets. India already had duty-free access for over 60% of its merchandise exports to the UK, hence, its focus on the FTA was to gain greater access for services exports," one of the officials said, requesting anonymity.
While the FTA will allow greater access for British agri-food items, including beverages, India's sensitive agricultural sectors have been protected, he said. "The agreement takes fully into account the interests of Indian producers of sensitive agricultural products like dairy products, vegetables, apples, edible oils, oats, etc, by keeping those tariff lines under the sensitive list," the official said.
According to the deal, India has secured mobility provisions for skilled professionals, including contractual service providers, investors, yoga teachers, and chefs; the UK said that such travels are "temporary" to deliver services and not a route for immigration.
The UK has provided a quota of 1,800 per year for qualified, professional Indian traditional chefs, yoga instructors, and classical musicians entering as contractual service suppliers. Under this arrangement, temporary entry and stay are permissible up to 12 months in any 24 months or for the duration of the contract, whichever is less, an official said.
As part of the deal, the two sides agreed on business mobility, granting access for short-term business travel into the UK and India.
"This will give UK businesses and professionals a guarantee that existing access to the Indian market will continue," the UK government said in an explainer, citing the example that UK businesses could also get the opportunity to supply services in India across sectors such as engineering and accounting.
In a post on X, Union commerce minister Piyush Goyal said: "Duty-free access for about 99% of Indian exports unlocks nearly $23 billion in opportunities for labour-intensive sectors, marking a new era for inclusive and gender-equitable growth. "...
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