Britain and India clinch landmark trade deal in shadow of Trump’s tariffs | Reuters

2 comments

1. **Summary:**

   * **Historic Free Trade Agreement (FTA) Concluded:** After late-stage negotiations in London, India and the UK have finalized a comprehensive FTA alongside a Double Taxation Avoidance Convention, marking a milestone in their Strategic Partnership.

   * **Key Issues Resolved:** The two sides ironed out contentious points on rules of origin, short-term professional visas, and the UK’s Carbon Border Adjustment Mechanism—India secured a “rebalancing mechanism” to offset any CBAM-related export losses.

   * **Scope and Benefits:**

   * **Goods & Services:** The agreement covers both merchandise and services, aiming to lower tariffs, expand market access, and deepen economic integration.
   * **Textiles & Labour-Intensive Sectors:** Indian textiles, currently facing up to 10% UK tariffs, stand to gain significantly, improving competitiveness against rivals like Bangladesh.
   * **Services Mobility:** Easier movement and short-term visas for Indian professionals will bolster India’s growing services sector.

   * **Tariff Reductions:**

   * UK to cut tariffs on Indian exports, leveling the playing field.
   * India to reduce duties on select UK imports (e.g., cars, whisky), though average Indian tariffs (14.6%) remain higher than the UK’s (4.2%).

   * **Economic and Employment Impact:** The FTA is expected to boost bilateral trade, generate jobs, enhance living standards, and foster innovation and investment in both economies.

   * **Next Steps:**

   * Finalization of a Bilateral Investment Treaty (BIT) alongside the FTA.
   * Preparations for UK Prime Minister Keir Starmer’s upcoming visit to India.

   * **Broader Negotiation Context:** This UK deal is the first of several FTAs India is pursuing, including talks with the US, EU, Chile, and Peru, driven by global tariff uncertainties and a desire to diversify trade ties.

   Overall, the India-UK FTA represents a balanced, ambitious framework designed to deepen commercial linkages, create new opportunities for businesses, and strengthen people-to-people connections between the two countries.

2. The most Impressive thing about the deal is that the UK was able to negotiate it without conceding on the point about visas for Indians, which India has been strongly pushing for in trade deals with other nations.
   Not sure How many Indians will be driving around in Aston Martins though.

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