A Trade and Gender Equality Working Group will be set up to support women entrepreneurs and rural communities in navigating export processes and assessing progress.
New Delhi/London (India CSR): The United Kingdom and India on Monday signed the Comprehensive Economic and Trade Agreement (CETA), hailed as a “landmark” deal poised to reshape economic ties between the world’s fifth and sixth-largest economies.
The agreement, which slashes tariffs and opens new markets, has been described by London as “the best that any country has ever agreed with India,” while New Delhi terms it “A People’s Deal: Opportunities for All.”
UK’s expectations: “best deal ever”
The UK government has projected sweeping benefits. Officials say the agreement could raise UK exports to India by 60 per cent in the long term, add £4.8 billion to GDP, and increase wages by £2.2 billion annually.
Beneficiaries include British manufacturers and service providers in sectors ranging from luxury cars to Scotch whisky, gin, food products, cosmetics, pharmaceuticals and technology.
Key provisions include lowering duties on luxury vehicles — such as Jaguar Land Rover, Rolls-Royce and Bentley — from 110 per cent to 30 per cent, with further reductions phased in by 2031. Tariffs on Scotch whisky and gin will fall from 150 per cent to 75 per cent, and eventually to 40 per cent over ten years.
A non-discrimination clause in Indian government procurement will also allow UK firms to bid on par with local suppliers.
Table 1: Key Provisions for the UK
| Sector/Provision | Current Tariff | New Tariff (Immediate) | Future Tariff (Timeline) |
|---|---|---|---|
| Luxury Cars (Jaguar, Rolls-Royce, Bentley) | 110% | 30% | 10% by 2031 (with quotas) |
| Scotch Whisky & Gin | 150% | 75% | 40% after 10 years |
| Government Procurement | Limited access | Non-discrimination clause | Equal footing with Indian suppliers |
India’s framing: “A People’s Deal”
The Indian government has projected inclusive benefits, highlighting its “Farmers: Sow Local, Sell Global” campaign. Lower tariffs on fruits, vegetables, pulses and marine products such as frozen prawns are expected to boost rural incomes while making Indian goods more affordable in Britain.
Officials said India anticipates a 25 per cent rise in exports to the UK, led by technology, pharmaceuticals, automobiles, food and retail, ready-made garments, jewellery and gems.
British Indian-owned businesses, numbering nearly 1,200 and employing more than 126,000 people, also expect to benefit from smoother cross-border trade and better access for micro, small and medium enterprises (MSMEs).
Table 2: India’s Expected Gains
| Sector | Expected Export Growth | Key Products |
|---|---|---|
| Technology | +25% to UK | IT services, software |
| Pharmaceuticals | +25% | Generic drugs, vaccines |
| Automobiles | +25% | Auto parts, vehicles |
| Agriculture & Marine | Significant | Fruits, vegetables, pulses, frozen prawns |
| Ready-made Garments & Jewellery | +25% | Apparel, gems, jewellery |
Concerns over local impact
Yet, scepticism remains strong in India. Critics warn that tariff cuts on whisky, tobacco, soft drinks, chocolate and cosmetics could hurt domestic producers and threaten jobs in auto manufacturing and agro-processing, which employ millions.
There are also concerns over India opening its government procurement market to UK bidders — a move some fear may erode the “Make in India” self-reliance policy.
Meanwhile, meeting UK sanitary and phytosanitary standards could prove resource-intensive for Indian exporters, particularly smaller farmers and food producers.
Labour rights and gender equality commitments in the deal are welcome, but enforcement in India’s vast informal sector is weak, with persistent concerns over child labour, poor working conditions and low female participation in the workforce.
Table 3: Concerns and Commitments
| Area of Concern | Risk for India | Commitments in CETA |
|---|---|---|
| Domestic Competition | UK imports may undercut local producers (whisky, cosmetics, autos) | Phase-in of tariff cuts, quotas |
| Procurement | UK access may weaken “Make in India” | Safeguards under non-discrimination |
| Food Safety Standards (SPS) | Compliance costs high for small exporters | Technical cooperation proposed |
| Labour Rights & Gender Equality | Weak enforcement in informal sector | Joint committees & gender working group |
| Sustainability | Fear of dilution in domestic priorities | Reaffirmation of ILO & UN SDGs |
Gender, labour and sustainability chapters
CETA includes dedicated provisions on labour rights, trade and gender equality, and environmental sustainability. A Trade and Gender Equality Working Group will be formed to support women entrepreneurs and rural communities. Both governments have reaffirmed commitments under International Labour Organisation conventions and the UN Sustainable Development Goals.
Rights advocate calls for vigilance
Bharti Patel, an international human rights advocate, welcomed the inclusion of social commitments but cautioned against over-promising.
“This agreement will only be meaningful if the commitments on labour rights, gender equality and sustainability translate into real change for farmers, workers, and women in the informal sector,” Patel told India CSR. . “Trade should not come at the cost of regulatory autonomy or the protection of vulnerable communities.”
The road ahead
As the two nations celebrate a historic step in their economic partnership, the ultimate success of CETA will hinge not only on tariff reductions but also on effective implementation, political will, and sustained support for small businesses and marginalised groups.
“The best deal ever” or “A people’s deal” — the test lies in whether the benefits are broadly shared and whether trade between India and the UK is truly fair and just.
The Bigger Question
While the UK expects clear economic gains, many Indian commentators question whether the benefits will be as significant for India – or whether they come at the cost of regulatory autonomy, development priorities, and local industry protection.
The key challenge lies in ensuring:
- Small and large Indian exporters can meet SPS standards.
- Farmers and MSMEs gain from global access rather than lose to foreign competition.
- Labour rights, gender equality, and sustainability commitments translate into real, enforceable change.
As both sides move forward, the success of this agreement will depend not only on tariff reductions but also on effective implementation, strong political will, and meaningful support for small businesses, women, and vulnerable groups to ensure that trade between countries is fair and just.
(India CSR)
