The India-UK Free Trade Agreement is being called a “game-changer.” But for whom exactly? The deal aims to deepen the $60-billion trade relationship between the two countries, but scratch beneath the surface and you’ll see a more nuanced picture—one of cautious openings, strategic delays, and clear red lines.
Let us start with the promises. For Indian exporters, the FTA brings a long-awaited break. Textiles, footwear, carpets, and marine products—sectors that have long struggled with 4-16% tariffs in the UK—are set to gain a much-needed competitive edge. But this isn’t a charity from London.
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British exporters get their share of the pie too. Indian consumers will soon see lower price tags on Scotch whisky and luxury British cars. Well, sort of. That coveted Range Rover you have been eyeing? You’ll have to wait a while longer for it to become affordable.
Here’s where it gets procedural. The text of the FTA isn’t done yet. Once it is, lawyers from both sides will scrutinize every comma—a process called ‘legal scrubbing.’ Expect at least three more months of back-and-forth. Then, it goes to the UK Parliament for ratification, which could take up to a year. So, don’t expect overnight changes. This is diplomacy, not e-commerce.
For India, the auto sector was non-negotiable. The deal allows a gradual cut in tariffs on UK cars—from over 100% down to 10%. But—and this is key—only within strict quotas. And even that reduction will stretch over 10 to 15 years. New Delhi has ensured that there’s no backdoor entry for budget vehicles or electric cars. There’s also a clever move to adjust duties based on the car’s price tag and engine capacity. Translation: Luxury cars may get cheaper eventually, but the Indian auto industry won’t lose sleep over it anytime soon.
Scotch whisky—always a headline-grabber. Under the deal, India will cut tariffs from 150% to 75% immediately and to 40% over ten years. Will this trigger a flood of Scotch into Indian bars and homes? Unlikely. Officials point out that Scotch makes up just 2.5% of India’s whisky market. Plus, it’s a protected product—Scotch can only be made in Scotland, in limited quantities. So, while imports will rise, fears of a market flood are overstated. Also, despite demands from India’s domestic industry, there’s no provision for a minimum import price—negotiators have made it clear that fears of dumping are unfounded.
Not everything is up for grabs in this FTA. Sensitive sectors have been cordoned off. Agriculture is a red line—India has kept dairy, apples, cheese, oats, and vegetable oils outside the deal to protect its farmers. The same goes for key industrial products like plastics, diamonds, silver, smartphones, base stations, and optical fibres. No duty cuts, no concessions.
This FTA is not a sweeping open-door policy. It is a carefully measured handshake—balancing strategic ambitions with domestic sensitivities. Gains will come, but in calibrated doses, and always with an eye on protecting India’s homegrown industries.
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