What is expected to get cheaper as India & UK conclude Free Trade Agreement?
The recently-concluded India-UK Free Trade Agreement (FTA) is expected to have a significant impact on the prices of various goods in both countries. The agreement, signed by the two nations, aims to increase trade and investment between them by reducing tariffs and other trade barriers. In this blog post, we will explore what goods are expected to become cheaper as a result of this agreement.
One of the most significant benefits of the FTA is the reduction in tariffs on distilled spirits. According to Reuters, tariffs on gin and whisky will be halved from 150% to 75%, making these popular spirits cheaper for Indian consumers. This reduction in tariffs is expected to boost the sales of UK-produced gin and whisky in India, which is the world’s second-largest spirits market.
Another major area where tariffs will be cut is in the automotive sector. The agreement will reduce tariffs on UK-imported vehicles from 100% to 10%, making these vehicles cheaper for Indian consumers. This reduction in tariffs is expected to boost the demand for UK-produced vehicles in India, which is one of the world’s fastest-growing automotive markets.
In addition to distilled spirits and vehicles, the FTA will also reduce tariffs on a range of other UK goods. Cosmetics, chocolates, soft drinks, electrical machinery, and biscuits are all expected to become cheaper for Indian consumers as a result of the agreement. These goods are some of the most popular imports in India, and the reduction in tariffs is expected to boost sales and increase competition in these markets.
The FTA is also expected to benefit UK businesses, which will have greater access to the Indian market. The agreement will reduce tariffs and other trade barriers, making it easier for UK companies to export goods to India. This increased access to the Indian market is expected to boost UK exports and create new business opportunities for UK companies.
The FTA is also expected to have a positive impact on the Indian economy. The reduction in tariffs and other trade barriers is expected to increase trade and investment between the two countries, which will boost GDP and create new jobs. The agreement is also expected to improve the competitiveness of Indian businesses, which will be able to access the UK market more easily and compete with UK companies.
The FTA is the result of negotiations between the two countries, which began in 2017. The agreement was signed by UK Prime Minister Rishi Sunak and Indian Prime Minister Narendra Modi in January 2022. The agreement is expected to come into effect in the coming months, after which tariffs and other trade barriers will be reduced.
In conclusion, the India-UK Free Trade Agreement is expected to have a significant impact on the prices of various goods in both countries. The reduction in tariffs on distilled spirits, vehicles, and other goods is expected to boost sales and increase competition in these markets. The agreement is also expected to benefit UK businesses, which will have greater access to the Indian market, and the Indian economy, which will see increased trade and investment.
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