India – UK Sign Historic Free Trade Agreement with Double Contribution Convention
NEW DELHI, May 6: India and the United Kingdom on Tuesday concluded an ambitious free trade deal along with a “Double Contribution Convention” with the Prime Minister Narendra Modi saying that the landmark pacts will catalyse trade, investment, growth and job creation in both the economies.
Mr Modi made the announcement on the agreements after a phone conversation with his British counterpart Keir Starmer. “In a historic milestone, India and the U.K. have successfully concluded an ambitious and mutually beneficial Free Trade Agreement, along with a Double Contribution Convention,” Mr Modi said in a social media post.
“These landmark agreements will further deepen our Comprehensive Strategic Partnership, and catalyse trade, investment, growth, job creation, and innovation in both our economies,” he said. Mr Modi said he was looking forward to welcoming Mr Starmer in India soon.
As per the agreement, 99% Indian exports to benefit from zero duty in U.K. market.
Indian import duty will be slashed, locking in reductions on 90% of tariff lines, 85% of these becoming fully tariff-free within a decade.
India reducing tariff for: whisky, medical devices, advanced machinery, and lamb, making U.K. exports more competitive
Goods with reduced import duties for Indian consumers: cosmetics, aerospace, lamb, medical devices, salmon, electrical machinery, soft drinks, chocolate and biscuits
Products with cheaper prices for British shoppers: clothes, footwear, and food products including frozen prawns
Automotive tariffs will go from over 100% to 10% under a quota
Three-year exemption from social security payments for Indian employees working in the U.K.
Export opportunities for labour-intensive sectors such as textiles, marine products, leather, footwear, sports goods and toys, gems and jewellery, engineering goods, auto parts and engines, and organic chemicals.
The leaders described it as a historic milestone in the bilateral Comprehensive Strategic Partnership that would foster trade, investment, innovation and job creation in both the economies. Both agreed that the landmark agreements between the two big and open market economies of the world would open new opportunities for businesses, strengthen economic linkages, and deepen people-to-people ties.
The Prime Minister’s Office said the two leaders agreed that expanding economic and commercial ties between India and the U.K. remained a “cornerstone” of the increasingly robust and multifaceted partnership.
“The conclusion of a balanced, equitable and ambitious FTA, covering trade in goods and services, is expected to significantly enhance bilateral trade, generate new avenues for employment, raise living standards, and improve the overall well-being of citizens in both countries,” it said. “It will also unlock new potential for the two nations to jointly develop products and services for global markets,” it added.
“This agreement cements the strong foundations of the India-U.K. Comprehensive Strategic Partnership, and paves the way for a new era of collaboration and prosperity,” the PMO said in a statement.
(Manas Dasgupta)
