Significant Milestone in India-UK Diplomacy: Prime Minister Modi Announces on Agriculture and Trade Agreement
In a significant move, India and the United Kingdom have signed a comprehensive economic and trade agreement, marking a new era in their bilateral relations. The deal, which aims to double bilateral trade by 2030, is expected to significantly enhance economic integration between the two nations.
Both India and the UK are united in their stance that there is no place for double standards in the fight against terrorism. Prime Minister Narendra Modi shared his views on peace and stability in the Indo-Pacific, the ongoing conflict in Ukraine, and the situation in West Asia with his UK counterpart.
The India-UK Free Trade Agreement (FTA) includes several key provisions that will affect various sectors and products, leading to tariff reductions and increased market access for both countries.
For Indian exports, labour-intensive industries such as textiles, marine products, leather goods, footwear, sports goods, toys, and gems and jewelry will benefit from nearly 99% duty-free access to the UK market. Fast-growing sectors like engineering goods, automotive components, and organic chemicals will also gain from reduced tariffs. The processed food industry will see duties on 99.7% of processed food items eliminated, providing substantial opportunities for export businesses.
On the UK side, tariffs on spirits like whisky and gin imports will be reduced from 150% to 75% initially, and further to 40% over a ten-year period. The automotive industry will also benefit, with tariffs on British cars significantly reduced, from over 100% to 10%, although with quota limitations.
The agreement is expected to increase the UK's GDP by 0.13% and India's GDP by 0.06% annually. It is projected that the joint goal of doubling bilateral trade to USD 56 billion by 2030 will create new opportunities in the British market for India's agricultural produce and processed food industry.
The FTA is expected to boost job opportunities in India, particularly in labour-intensive industries. Consumers in both countries will benefit from increased access to a wider range of products at competitive prices due to tariff elimination or reduction.
Prime Minister Modi thanked the UK for its strong condemnation of the Pahalgam terror attack and expressed condolences for the deaths of several British citizens in the Air India plane crash in Ahmedabad last month. He also mentioned the "Vision 2035" roadmap to boost the comprehensive strategic partnership between India and the UK in the next decade.
The deal will also see the security agencies of India and the UK continuing to enhance cooperation and coordination on matters such as the extradition of economic offenders. Respect for the sovereignty and territorial integrity of all countries is essential, according to PM Modi.
Today, on this historic day in India-UK relations, the UK has signed the biggest and economically most significant trade deal since leaving the European Union. The deal will increase market access and cut tariffs on British whisky and cars, marking a new chapter in the long-standing relationship between the two nations.
- The India-UK Free Trade Agreement (FTA) will greatly benefit India's labor-intensive industries, such as textiles, as they will have nearly 99% duty-free access to the UK market, providing increased opportunities for export businesses.
- The FTA is also significant for the UK's finance sector, as tariffs on spirits like whisky and gin imports will be reduced, from 150% to 75% initially, and further to 40% over a ten-year period, boosting the UK's exports in this sector.
- The agreement will also impact the political landscape, with India's Prime Minister Modi and his UK counterpart discussing policy-and-legislation matters such as the ongoing conflict in Ukraine, the situation in West Asia, and the need for respect for the sovereignty and territorial integrity of all countries, highlighting the importance of maintaining strong ties in general-news and politics.
