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 trade dynamics between the two countries. The agreement, signed on April 21, 2022, aims to promote trade and investment between India and the UK, and there are several products that are expected to become cheaper as a result. In this blog post, we will explore some of the key products that will benefit from the tariff cuts and reduced trade barriers.
One of the most notable benefits of the FTA is the reduction in tariffs on distilled spirits. As reported by Reuters, tariffs on gin and whisky will be halved from 150% to 75%. This means that Indian consumers can expect to pay less for these popular spirits. The reduction in tariffs will also make it more attractive for Indian distilleries to export their products to the UK.
Another significant benefit of the FTA is the reduction in tariffs on automotive products. Currently, tariffs on UK-imported vehicles are as high as 100%. However, under the new agreement, these tariffs will be cut to just 10%. This means that UK-imported vehicles will become cheaper for Indian consumers, making them more competitive in the market. The reduction in tariffs will also make it more attractive for UK-based automotive companies to establish manufacturing facilities in India.
Other UK goods that will benefit from the tariff cuts include cosmetics, chocolates, soft drinks, electrical machinery, and biscuits. These products will also see a reduction in tariffs, making them more competitive in the Indian market.
So, what does this mean for Indian consumers? In simple terms, it means that they can expect to pay less for these products. The reduction in tariffs will lead to increased competition in the market, which will drive down prices and make these products more accessible to Indian consumers.
The FTA will also benefit Indian businesses that import these products from the UK. With reduced tariffs, they will be able to negotiate better prices with their UK suppliers, which will help to increase their profit margins.
The agreement is also expected to boost trade between the two countries. According to the Indian government, the FTA is expected to increase India’s exports to the UK by 15% to 20% in the next five years. This will not only provide a boost to India’s economy but also create new job opportunities.
The benefits of the FTA are not limited to just the reduction in tariffs. The agreement also aims to simplify the complex procedures and rules that currently govern trade between the two countries. This will make it easier for businesses to import and export goods between India and the UK, which will help to increase trade and investment.
In conclusion, the recently-concluded India-UK FTA is expected to have a significant impact on trade between the two countries. The reduction in tariffs on distilled spirits, automotive products, and other UK goods will make these products cheaper for Indian consumers. The agreement will also benefit Indian businesses that import these products from the UK and boost trade and investment between the two countries.
