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Informist, Thursday, May 8, 2025

 

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--Govt source: UK to give zero duty on 95% agri-related tariff lines in FTA
--Govt source: No tariff concession to UK on key agri, industry under FTA
--Govt source: UK to give assured regime for Indians' temporary entry in FTA
--Govt source: UK to give assured regime for Indians' stay requirement in FTA
--Govt source: Aim to increase trade with UK to $120 bln by 2030
--Govt source: UK FTA to serve as gold standard for future trade agreements
--Govt source: Text of FTA with UK to be out in 3 months post legal scrubbing
--Govt source:Opening auto, alcohol sectors to UK under FTA to benefit India
--Govt source: To discontinue India's protectionist stance on auto sector
--Govt source: Auto industry onboard on opening up domestic auto sector
--Govt source: India to retaliate if UK plans to impose carbon tax in future
--Govt source: FTA with UK to be implemented in a year
--Govt source: Duty cut on auto sector under UK FTA in phased manner

 

NEW DELHI– The text of India's free trade agreement with the UK would be released in the next three months, after legal scrubbing, three commerce ministry officials said, adding it would take over a year in ratification of the pact. Both the sides announced the conclusion of trade negotiations on Tuesday.

 

New Delhi and London would collaborate in the next three months to finalise the text of the trade deal, one of the official said. India expects the trade deal with the UK would help bilateral trade to rise to $120 billion by 2030, according to the officials. 

 

Under the trade agreement, India has committed to cut duty on 90% tariff lines while the UK would slash duty on 99% tariff lines. But India has not committed duty concession on sensitive farm sector goods as well as industrial products, including precision metals, smartphones, and optical fibers, the official clarified. On medical devices, India would reduce duty only after 2031, according to the official.

 

India has committed to lower duty on import of British auto products to 10% from 100% under a fixed quota, which would be implemented in a phased manner, another official said without quantifying the quota limit. He added that duty concessions would also be on "futuristic electric vehicles".

 

 

India has missed opportunities in the past due to its protectionist stance on the auto sector, and going forward, the government would discontinue such a stance, the third official said. The auto sector is onboard with the government's decision, the official added. India has maintained customs duty of over 100% on auto products for several years.

 

Giving greater access to British alcohol and automotives in Indian markets is likely to be beneficial, the official said. India has committed to cut duty on whisky and gin to 75% from 100% first and then bring it down to 40%. 

 

New Delhi and London have also agreed that the former could retaliate if the latter plans to impose non-tariff barriers like Carbon Border Adjustment Mechanism, the third official mentioned. The UK, on other hand, has committed to make 95% agri-related tariff lines duty-free, the first official said. 

Along with the trade deal, India has also concluded discussions for a Double Contribution Convention Agreement that exempts Indian workers in the UK from paying social security contributions for three years. Under this, the UK would provide assured regime for temporary entry and stay requirements to Indians for business visits, intra-corporate transfers, and contractual service supply, the first official mentioned.

 

The trade deal, which opens new avenues for cooperation with the UK, would serve as a gold standard for future trade pacts, the official said. Both sides had a bilateral goods trade of $18.64 billion in Apr-Jan, as per the latest data available with the commerce ministry. 

 

Interestingly, none of the government officials gave a reason for making the announcement of conclusion of trade talks with the UK, when the text of the pact is yet to be finalised. But it is worth noting that the announcement comes when both the sides were eager to seal a deal with the US to avoid the implications of Washington's proposed reciprocal tariffs.  End

 

Reported by Krity Ambey

Edited by Akul Nishant Akhoury

 

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