FTA with UK marks India's maturing global presence, readiness to lead growth
Written by Harsh Vardhan Agarwal
The India-UK Free Trade Agreement (FTA) marks not just a high point in India's trade negotiations but a transformative opportunity for Indian industry. It is a signpost of India's maturing global presence — no longer content to participate in trade from the sidelines, but ready to lead, partner and shape the next wave of global economic growth.
Historically, Indian exporters — particularly in sectors like textiles, apparel, marine products, leather, and toys — have been at a tariff disadvantage in developed markets like the UK. That changes now. With zero-duty access for nearly 99 per cent of Indian tariff lines, Indian firms finally enjoy a level playing field against competitors from the EU, Bangladesh and CPTPP countries. Consider apparel: Indian exports to the UK have been penalised by tariffs of up to 12 per cent while Bangladesh and China thrived on preferential access. Post-FTA, this handicap is eliminated. But this opportunity demands a mindset shift from commodity exports to branded, differentiated offerings for premium, regulated markets.
India's approach to the FTA reflects a calibrated strategy. While offering duty-free access to 85 per cent of UK products over a phased 10-year period, India has protected sensitive sectors such as dairy, apples, edible oils, smartphones and medical devices. This balance of openness with strategic autonomy ensures Make in India and employment-intensive sectors are not disrupted. This should serve as a blueprint for future trade deals.
The FTA's most ambitious provisions lie in the services sector, a domain where India has a global edge. With enhanced market access for Indian IT, telecom, education, and financial services firms, and provisions that facilitate professional mobility, this agreement clears a long-standing barrier: Ease of deploying talent in the UK. The landmark Double Contribution Convention, which waives UK social security contributions for Indian professionals on temporary assignments, is not just a cost-saving tool. It will make Indian service exports even more competitive. Equally important is the mutual commitment to recognition of professional qualifications. Indian architects, accountants, engineers, and educators can now have seamless UK careers.
The FTA provides a platform for deep bilateral cooperation in investment, innovation, and research. With the UK's strength in design, R&D and advanced manufacturing, and India's strength in scale, talent, and execution, this agreement paves the way for joint IP creation, technology transfer, and co-manufacturing. Businesses must begin to see the UK not just as an export destination but as a partner in value chain innovation, where both countries can co-develop for global markets.
For the first time, an Indian FTA includes chapters on labour rights, environmental protection, consumer welfare, gender equity and anti-corruption. These reflect India's evolving economic maturity and its recognition that future trade will be governed by values and transparency, not just volumes. Indian businesses must now invest in compliance, ESG readiness and workforce diversity.
To leverage this opportunity, Indian businesses must build UK-specific market strategies rooted in consumer insight, brand localisation, and agile fulfilment models. Invest in certifications, regulatory compliance, and product innovation to meet UK standards and expectations. Reskill and redeploy talent, especially in legal, financial, supply chain, and customer-facing roles. Form joint ventures and R&D partnerships with UK firms to accelerate innovation and de-risk expansion. Create feedback loops from UK market performance.
India's long-term economic vision — Viksit Bharat — demands that we expand our share of global trade, move up the value chain, and create large-scale employment. The India-UK FTA is a major leap toward that vision. This is an inflexion point for India to transform from a cost-driven export economy to a value-creating global powerhouse. It is time to stop thinking in terms of export incentives and start thinking in terms of global brand leadership.
The writer is president, FICCI and vice chairman & MD, Emami Limited
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