India-UK trade pact takes effect, cutting tariffs and boosting services trade

By Manoj Kumar and Shivangi Acharya

NEW DELHI, July 15 (Reuters) - India and Britain's commercialized pact took effect connected Wednesday, cutting tariffs connected thousands of goods and expanding marketplace entree for services firms and ‌professionals successful some countries.

The India-UK Comprehensive Economic and Trade Agreement gives Indian exporters duty-free entree to astir ‌British tariff lines, benefiting sectors specified arsenic textiles, leather, footwear, marine products, gems and jewellery, and processed foods.

Britain, meanwhile, gains greater entree to 1 ​of the world's fastest-growing large economies done phased tariff cuts and quotas for sectors specified arsenic automobiles and silver, arsenic good arsenic openings successful procurement, fiscal services, education, security and nonrecreational services.

Prime Minister Narendra Modi said successful a station connected X that the commercialized pact and accompanying societal information statement would deepen economical ties and springiness "fresh momentum" to India's farmers, entrepreneurs ‌and tiny businesses.

India exported $13.44 cardinal of goods ⁠to Britain and imported $11.68 cardinal successful the 2025/26 fiscal year. Bilateral services commercialized totalled $35.44 cardinal successful 2024, with India moving a services surplus of astir $7.9 billion, according to Indian commercialized ⁠ministry data.

Britain volition instantly region duties connected 96.8% of tariff lines, covering 97.7% of commercialized by value. India volition destruct duties astatine erstwhile connected 64.1% of tariff lines and gradually signifier them retired connected a further 21%, portion excluding delicate products.

Indian officials ​expect gains ​in sectors wherever British tariffs had ranged from 4% to ​20%. Duties connected marine exports, textiles, leather, footwear, ‌gems and jewellery volition beryllium eliminated, boosting the competitiveness of Indian exports.

Engineering exporters besides expect to benefit. Britain is among India's apical 5 engineering export markets, with shipments rising to $4.7 cardinal successful 2025/26. Exports climbed 34.4% year-on-year to $972.5 cardinal successful the archetypal 2 months of 2026/27, according to the Engineering Export Promotion Council (EEPC) of India.

EEPC Chairman Pankaj Chadha said the statement would amended marketplace entree for products including electrical machinery, car components and steel, helping engineering exports to Britain ‌exceed $7.5 cardinal by 2029/30.

Britain is acceptable to payment from India's gradual ​opening of its automobiles and alcoholic beverages markets. Passenger conveyance imports ​will beryllium taxable to a phased quota system, ​allowing 37,000 afloat built vehicles a twelvemonth to participate astatine preferential tariff rates.