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Informist, Friday, Jul. 25, 2025

NEW DELHI – Under the freshly signed Comprehensive Economic and Trade Agreement with the UK, India stands to benefit with many labour-intensive sectors seeing a boost in exports, including agriculture and processed foods, the commerce ministry said Friday. Commerce Secretary Sunil Barthwal, who was addressing the media Friday, said the agreement balances the "strengths and sensitivity" of both countries.

Thursday, the two nations signed a free trade agreement under which India has committed to cut duty on 90% tariff lines while the UK would slash duty on 99% tariff lines. Both sides have set the aim of doubling bilateral trade by 2030. Trade between India and the UK was worth $23.15 billion in the financial year 2024-25 (Apr-Mar).

In a presentation, the ministry said exports of agricultural and processed food products are expected to rise over 50% in the next three years. Under the trade agreement, new opportunities have been unlocked while ensuring protection of sensitive interests, especially of farmers, the ministry said.

Under the agreement, India's farmers will get access to the UK's $37.5 billion market. Except rice, the UK has committed to cut duty to zero on all farm produce from India. This is expected to help Indian farm exports to the UK grow 20% in three years. New Delhi, on the other hand, has not offered any duty concessions in the agricultural sector, including on dairy products and edible oil. London has also kept some of its sensitive sectors, like sugar, milled rice, pork, chicken, and eggs, out of the purview of the agreement. It has allowed duty-free access to Indian seafood, however.

The trade deal does not entail any safeguard duty and, hence, provides penalty-free market access. The agreement, which, according to Barthwal, the UK will ratify soon, can help India gain over 5% market share in the UK in two years.

Among other labour-intensive sectors that will attract zero duty in the UK after the free trade agreement, the commerce ministry said exports of leather and footwear to London could double in 2-3 years and exports of gems and jewellery could surpass $2.5 billion in another three years. The ministry also said engineering goods exports to the UK could double to $7.5 billion in the next five years and exports of electronic and telecommunications goods may double to $4 billion in the same period.

Both sides sealed the deal Thursday after negotiating for over three years. The UK is among India's top 10 export destinations. India exported goods worth $14.55 billion and imported $8.61 billion worth of goods in FY25, according to data available with the commerce ministry.  End

US$1 = INR 86.51

Reported by Sagar Sen

Written by Priyasmita Dutta

Edited by Rajeev Pai

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