India-UK FTA set to reduce cost of British goods and strengthen Indian exports from July 15

The India-UK Comprehensive Economic and Trade Agreement (CETA) will come into force on Wednesday, paving the way for cheaper British goods in India while granting Indian exporters near-total duty-free access to the UK market.

Under the pact, tariffs on a wide range of British products -- including Scotch whisky, gin, chocolates, biscuits and cosmetics -- will begin declining from July 15. However, duty reductions for several items will be phased in over the coming years.

Meanwhile, Indian exporters will receive zero-duty access on around 99 per cent of tariff lines, covering almost the entire value of the country's exports to the UK.

Labour-intensive sectors such as textiles, leather, footwear, marine products, gems and jewellery, sports goods and toys are expected to be among the biggest beneficiaries.

Similarly, engineering goods, auto components and organic chemicals are also set to gain from improved market access.

The rules were issued by the Central Board of Indirect Taxes and Customs (CBIC), laying down the framework for determining whether goods qualify for preferential tariff treatment under the pact and specifying compliance requirements for exporters and importers.

Union Commerce and Industry Minister Piyush Goyal had earlier said the CETA would deepen collaboration between the two countries across trade, investment and innovation while creating new opportunities for businesses and professionals

He urged Indian companies to strengthen engagement with their UK counterparts and translate the agreement into sustained business growth.

Earlier in June, the minister stated that the landmark agreement will help Indian farmers, fishermen, artisans and small businesses prosper globally and accelerate job creation, while enabling the common man to access high-quality goods at competitive prices.

He noted that by unlocking the premium UK market, it creates attractive global opportunities for women entrepreneurs, youth, startups and MSMEs, while empowering the underprivileged without compromising India's core interests

Signed on July 24, 2025, after 14 rounds of negotiations, the CETA comprises 30 chapters covering goods, services, digital trade, financial services, intellectual property, innovation, sustainability and government procurement.

Additionally, India will reduce or eliminate tariffs on 90 per cent of tariff lines, with 85 per cent becoming fully duty-free over the next decade.

Tariffs on British Scotch whisky will be cut from 150 per cent to 75 per cent initially before declining to 40 per cent over 10 years, while duties on British automobiles will be reduced gradually under a quota-based mechanism.

The pact also provides relief for eligible Indian professionals working temporarily in the UK through the Double Contributions Convention, allowing them to avoid paying social security contributions in both countries for a specified period.