What is expected to get cheaper as India & UK conclude Free Trade Agreement?
The recently-concluded India-UK Free Trade Agreement (FTA) has sent waves of excitement across the business community, as it promises to bring down tariffs on a range of goods and services. As two of the world’s leading economies, India and the UK have signed a historic agreement that is expected to benefit both nations in numerous ways. In this blog post, we will explore some of the key highlights of the agreement and what you can expect to get cheaper in the coming days.
Tariffs on Distilled Spirits to Halve
One of the most significant benefits of the FTA is the reduction in tariffs on distilled spirits. Currently, gin and whisky imported from the UK face tariffs of 150%, making them relatively expensive in India. However, under the new agreement, these tariffs will be halved to 75%. This means that Indian consumers can expect to pay less for their favorite drinks. Whether you’re a connoisseur of fine spirits or just a casual drinker, this reduction in tariffs is expected to make a significant difference.
Automotive Tariffs to Cut from 100% to 10%
The automotive sector is another area that is expected to benefit from the FTA. Currently, UK-imported vehicles face tariffs of 100%, making them prohibitively expensive for many Indian buyers. However, under the new agreement, these tariffs will be cut from 100% to 10%. This means that Indian consumers can expect to pay significantly less for UK-imported vehicles. This reduction in tariffs is expected to boost the demand for UK cars in India, particularly in the mid-range and luxury segments.
Cosmetics, Chocolates, and Soft Drinks to Get Cheaper
In addition to distilled spirits and automotive products, several other UK goods are expected to benefit from the FTA. Cosmetics, chocolates, soft drinks, electrical machinery, and biscuits are just a few examples of the many products that will face lower tariffs under the agreement. This reduction in tariffs is expected to make these products cheaper and more accessible to Indian consumers.
Electrical Machinery and Biscuits to See Tariff Reductions
Electrical machinery and biscuits are two other areas that are expected to benefit from the FTA. Currently, UK-imported electrical machinery faces tariffs of up to 15%, while UK-imported biscuits face tariffs of up to 30%. However, under the new agreement, these tariffs will be cut to 10% and 20%, respectively. This reduction in tariffs is expected to make these products cheaper and more competitive in the Indian market.
What does this mean for Indian Businesses?
While the FTA is expected to benefit Indian consumers, it is also expected to have a positive impact on Indian businesses. With lower tariffs on UK-imported goods, Indian manufacturers will be able to source raw materials and components more cheaply, which will help to reduce their production costs. This, in turn, is expected to make Indian products more competitive in the global market.
What does this mean for UK Businesses?
The FTA is also expected to benefit UK businesses, particularly those in the automotive and manufacturing sectors. With lower tariffs on Indian goods, UK businesses will be able to source raw materials and components more cheaply, which will help to reduce their production costs. This, in turn, is expected to make UK products more competitive in the global market.
Conclusion
The India-UK FTA is a significant development in the world of international trade, and it is expected to have a positive impact on both nations. With lower tariffs on a range of goods and services, Indian consumers can expect to pay less for their favorite products, while Indian businesses will be able to source raw materials and components more cheaply. Whether you’re a consumer, a business owner, or just someone who is interested in international trade, the India-UK FTA is an exciting development that is worth keeping an eye on.
