New Delhi: The UK-India free trade agreement that took effect on Wednesday sets a "new gold standard" for global trade deals as it delivers sweeping sectoral benefits and sends a powerful message in support of a rules-based order, British High Commissioner Lindy Cameron said.
The mega trade pact, officially known as the Comprehensive Economic and Trade Agreement (CETA), is being billed as one of the biggest trade deals of modern times and secures zero-duty market access for nearly 99 per cent of India's exports to the UK.
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The coming into force of the CETA assumed greater significance as it came amid a fractured global trade environment largely triggered by US President Donald Trump's policies on trade and the lingering conflict in West Asia.
The trade deal, firmed up in July last year after three years of negotiations, will provide for comprehensive market access for Indian goods across all sectors, and India will gain from tariff elimination on about 99 per cent of tariff lines (product categories) covering almost 100 per cent of the trade values, according to officials.
It will facilitate slashing tariffs on British whisky and cars among other items and is set to double bilateral trade by 2030.
The trade deal is expected to help the Indian economy in sectors like textiles, leather, gems and jewellery, engineering goods, marine products, chemicals and processed foods.
A bilateral social security agreement too has been operationalised along with the trade deal.
Cameron, interacting with a group of journalists, said India and the UK have "unlocked the combined economic might of two global economic powerhouses".
The high commissioner said that the UK-India trade is set for an immediate boost as consumers will now be able to enjoy cheaper, quicker and easier access to the best of British and Indian products and services across both countries.
To celebrate the coming into force of the trade pact, a special package of select British goods arrived at the British mission in Mumbai this morning aboard a British Airways flight.
The package contained goods from the UK benefiting from reduced tariffs, including cosmetics, food products and alcoholic beverages.
"The UK-India FTA is the new gold standard of trade deals as it is pro-worker, pro-innovation, and pro-growth. It's a force multiplier and a template for future trade agreements," the British high commissioner said.
The pact sends a message to the rest of the world that the rules-based order works, she stressed.
"The UK-India trade deal brings sweeping benefits for a wide range of sectors. From today, import duty on Scotch whisky has been cut from 150 percent to 75 percent which should make a really significant difference to the price the consumer pays," she said.
"The FTA is also the biggest and the most ambitious modern free trade agreement to enter into force to date for both of our countries. It's the quickest turnaround for the UK bringing a new deal into force," she noted.
Cameron also said that the import duties on premium UK-built cars will also begin to fall from over 110 percent to 10 percent, making iconic British cars cheaper for Indian consumers.
"From today, our economies, our businesses, and most importantly, our people are going to start seeing the benefits of this trade deal. 99 percent of Indian goods and 90 percent of UK products entering India will be duty-free or (will have) reduced tariffs," she said.
The India-UK bilateral trade crossed USD 55 billion in 2023-24. The UK is the sixth largest investor in India, with a cumulative investment of USD 36 billion.
India's investments in the UK are close to USD 20 billion, and some 1,000 Indian companies operating in Britain provide employment to almost 100,000 people.
"This is a watershed moment for the UK-India partnership. As the landmark trade deal comes into force, what better than having select British products arriving in one of the very first UK flights into India this morning - with thanks to support from British Airways," the UK's Trade Commissioner for South Asia Harjinder Kang said in Mumbai.
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"Our landmark trade deal is designed to benefit businesses and consumers from day one with cheaper, quicker and easier trade. We are all excited to take full advantage of it."
David Wright, British Airways' General Manager in India, said: "India is one of British Airways' most important markets and we have a long history of connecting people, businesses, and cultures across the UK and India."
"With 63 flights each week going up to 70 by the end of summer, we play an important role in strengthening economic and cultural ties between our two countries."
Wright said the UK-India free trade agreement marks a significant milestone in the bilateral relationship and reinforces the long-term potential of one of the world's most dynamic international corridors.
"We are proud to support this landmark agreement and the opportunities it will create for trade, investment and tourism.
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