Executive Summary:
The Comprehensive Trade and Economic Agreement (CETA) between India and the UK, signed on July 24, 2025, following the conclusion of negotiations announced on May 6, 2025, aims to achieve deep economic integration through trade liberalization and tariff concessions. CETA will come into force after ratification by both countries. It seeks to double the bilateral trade value between the two countries by 2030.
Key Points / Main Content:
* **General Overview:**
* CETA is a modern, comprehensive, and landmark agreement.
* It ensures comprehensive market access for goods across all sectors, covering all of India's export interests.
* The agreement promotes good regulatory practices and enhances transparency.
* **Trade Benefits:**
* Provides duty-free access to almost 99% of India's exports to the UK, covering nearly 100% of the trade value.
* Benefits labour-intensive sectors (textiles, leather, marine products, gems and jewellery, toys) and high-growth sectors (engineering goods, chemicals, auto components).
* **Services Sector Provisions:**
* Provides greater market access in IT and IT-enabled services, financial and legal services, professional and educational services, and digital trade.
* Simplifies visa procedures and liberalises entry categories for Indian professionals.
* Includes an agreement on the Double Contributions Convention, exempting Indian professionals and their employers from social security payments in the UK for up to three years.
* **Inclusive Trade Measures:**
* Aims to make trade more inclusive for women and youth entrepreneurs, farmers, fishermen, startups, and MSMEs.
* Includes provisions that encourage innovation, promote sustainable practices, and reduce non-tariff barriers.
* **Bilateral Trade Target:**
* Seeks to double the bilateral trade value between India and the UK from approximately USD 56 billion by 2030.
Impact Analysis:
* **Traders:**
* Impact: Increased export opportunities due to duty-free access and market access in the UK.
* Action Required: Prepare to meet UK market demands and standards to capitalise on the trade agreement.
* **Indian Professionals:**
* Impact: Simplified visa procedures and exemption from social security payments in the UK for up to three years.
* Action Required: Be aware of the new visa rules and eligibility for social security exemption when seeking employment in the UK.
* **Artisans, Women-led Enterprises, and MSMEs:**
* Impact: Spurred employment generation and new access to global value chains.
* Action Required: Focus on innovation and sustainable practices to leverage opportunities in the UK market.
* **Indian and UK Governments:**
* Impact: Deeper and more resilient economic relationship, increased trade volumes, and job creation.
* Action Required: Ratify CETA for it to come into force.
Key Entities Referenced
India: A country engaged in a Free Trade Agreement (FTA) with the UK.
UK: The United Kingdom, a country engaged in a Free Trade Agreement (FTA) with India.
Free Trade Agreement: A bilateral agreement between India and the UK to promote trade and economic cooperation.
Comprehensive Trade and Economic Agreement (CETA): The name of the Free Trade Agreement (FTA) signed between India and the UK.
SHRI JITIN PRASADA: Minister of State in the Ministry of Commerce and Industry, who provided the answer to the parliamentary question.
Ministry of Commerce and Industry: The Indian government ministry responsible for trade and commerce.
Department of Commerce: A department under the Ministry of Commerce and Industry.
Double Contributions Convention: An agreement secured by India that exempts Indian professionals and their employers from social security payments in the UK for up to three years.
GOVERNMENT OF INDIA
MINISTRY OF COMMERCE & INDUSTRY
DEPARTMENT OF COMMERCE
LOK SABHA
UNSTARRED QUESTION NO. 1394
ANSWERED ON 29.07.2025
FREE TRADE AGREEMENT BETWEEN INDIA AND UK
1394. SHRI DHAIRYASHEEL SAMBHAJIRAO MANE:
SHRI MANISH JAISWAL:
SHRI CHAVAN RAVINDRA VASANTRAO:
SHRI SUDHEER GUPTA:
Will the Minister of COMMERCE AND INDUSTRY (वाणिज्य और उद्योग मंत्री )be pleased
to state :-
(a) whether bilateral free trade agreement being signed between Government of
India and Government of UK has reached its final stages/concluded, if so, the
details thereof;
(b) the salient features of the said bilateral trade agreement and the time frame by
which it is likely to be implemented;
(c) the manner in which the said trade deal will be beneficial to the traders of the
country and will open export opportunities for domestic traders;
(d) the sectors that are most likely to be benefited in the country by the said bilateral
trade deal; and
(e) the total bilateral trade value likely to be increased in terms of revenue between
two countries in the upcoming three years?
ANSWER
वाणिज्य और उद्योग मंत्रालय में राज्य मंत्री (श्री णिणिन प्रसाद)
THE MINISTER OF STATE IN THE MINISTRY OF COMMERCE AND INDUSTRY
(SHRI JITIN PRASADA)
(a) to (b): The Prime Ministers of India and UK had announced the successful
conclusion of India-UK FTA negotiations on 6th May, 2025. The trade deal, which has
been named as Comprehensive Trade and Economic Agreement (CETA), has been
signed on 24th July, 2025. The CETA with the UK is a modern, comprehensive and
landmark agreement, which seeks to achieve deep economic integration along with
trade liberalisation and tariff concessions. The CETA ensures comprehensive market
access for goods, across all sectors, covering all of India’s export interests. The CETA
seeks to promote good regulatory practices and enhance transparency that are in sync
with India’s own focus on domestic reforms to enhance the ease of doing business.
The CETA comes into force after ratification by both the countries.
1(c) to (e): CETA provides an unprecedented duty-free access to almost 99 per cent of
India’s exports to the UK, covering nearly 100% of the trade value. This includes
labour-intensive sectors such as textiles, leather, marine products, gems and jewellery,
and toys as well as high-growth sectors like engineering goods, chemicals, and auto
components etc. This will spur large-scale employment generation, empowering
artisans, women-led enterprises, and MSMEs. The services sector, a strong driver of
India’s economy, will also see wide-ranging benefits. The agreement provides greater
market access in IT and IT-enabled services, financial and legal services, professional
and educational services, and digital trade. Indian professionals, including those
deployed by companies to work in UK across all service sectors, professionals
deployed on contracts such as architects, engineers, chefs, yoga instructors, and
musicians, will benefit from simplified visa procedures and liberalised entry categories,
making it easier to work in the UK. India has also secured an agreement on the Double
Contributions Convention. This will exempt Indian professionals and their employers
from social security payments in the UK for up to three years, improving the cost
competitiveness of Indian companies. The agreement has been designed to make
trade more inclusive. Women and youth entrepreneurs, farmers, fishermen, startups,
and MSMEs will gain new access to global value chains, supported by provisions that
encourage innovation, promote sustainable practices, and reduce non-tariff barriers.
CETA is expected to boost trade volumes significantly in the coming years, creating
jobs, expanding exports, and supporting a deeper, more resilient economic
relationship between India and the United Kingdom. The bilateral trade between the
two countries stand at nearly USD 56 billion, with a goal to double this figure by 2030.
The press note issued by the Department in this regard may be seen at
https://www.pib.gov.in/PressNoteDetails.aspx?NoteId=154945&ModuleId=3.
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