India-UK Trade Pact Cuts Textile, Steel Tariffs to Zero Overnight

Indian exporters have a new set of numbers to celebrate now that the India-UK Comprehensive Economic and Trade Agreement (CETA) has come into effect. Under the deal, 99% of India’s tariff lines will enter the UK duty-free from day one, including gems and jewellery tariffs falling from 4% to zero, pharmaceuticals from 8% to zero, iron and steel from 10% to zero, and textiles from 12% to zero. Agricultural products get 95% duty-free access on agreed tariff lines.

The tariff cuts are already translating into shipments. A first jewellery consignment worth about USD 10 million was sent to the UK as CETA came into force, with 27 exporters from six major jewellery centres taking part. All India Gem and Jewellery Domestic Council (GJC) chairperson Rajesh Rokde described it as ‘a historic milestone for the Indian gems and jewellery industry,’ saying the agreement would push exports, investment, employment and India’s standing in the global market to new heights.

In Nagpur, the Nag Vidarbha Chamber of Commerce (NVCC), which represents 13 lakh traders across the Vidarbha region, said the reduced tariffs open new avenues for its members. NVCC former president Ashwin Mehadia said, ‘Now that exports from Vidarbha to the United Kingdom are starting with reduced tariff, new avenues of international trade will open for traders in Vidarbha and the region will see greater economic growth.’

NVCC vice-president Swapnil Ahirkar said Vidarbha already ships rice, pharma products, textiles and minerals abroad, and is now emerging as a hub for service exports as well, giving it a broad base to leverage the lower tariffs. NVCC secretary Hemant Sarda added that infrastructure support from the government would be key to converting the tariff advantage into higher export volumes: ‘If the govt improves export infrastructure here, it will help increase exports of goods and services from Vidarbha.’

At a CETA event in Mumbai, principal secretary (industries) P Anbalagan said close to 300 district export promotion council meetings had been held across Maharashtra, including in Amravati, Nagpur and Akola, drawing about 1.5 lakh participants, with the export drive extending to districts such as Gondia and Bhandara. He noted that seven to nine districts currently account for more than 70% of the state’s exports, and the aim is to widen that base.

Total trade between India and the UK currently stands at nearly USD 56 billion, and both countries are targeting a doubling of that figure by 2030.

Image credit: Wikimedia Commons / Ministry of Ports, Shipping and Waterways (GODL-India)