Gujarat's export engine ready to roar with UK-India FTA
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Ahmedabad: As global demand remains subdued and geopolitical uncertainties persist, the recently inked free trade agreement (FTA) between the United Kingdom and India offers a ray of hope for Gujarat, a highly manufacturing-heavy and export-oriented state.
With its strong base in sectors like textiles, chemicals, ceramics, and IT & IT-enabled services (ITeS), Gujarat stands to be a significant beneficiary of the tariff relaxations and market access provisions under the FTA.
Textiles: Gearing Up for Duty-Free Access
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Gujarat's textile sector, contributing over 12% of India's textile exports, is expected to be among the biggest winners. Indian garments currently face duties of 8% to 16% in the UK.
The FTA could eliminate or significantly reduce these tariffs, making Gujarat's cotton and man-made fibre garments more competitive against products from countries like Bangladesh, Vietnam, and Turkey.
Chintan Thaker, chairman of the Assocham Gujarat State Council, said, "The UK is the third biggest importer of textiles from India. Exports to the UK stand at $2.04 billion (approx Rs 17,000 crore), largely apparels and made-ups.
With the new FTA, we expect to double this by 2026."
Thaker added that apparel manufacturers are optimistic about the UK market, which offers better margins than the US. "With direct access to the UK market at zero duty, Gujarat's textile hubs like Surat and Ahmedabad could see a revival in export orders, boosting the local industry," he further said.
Ronak Chiripal, promoter, Chiripal Group, emphasised, "This move will directly improve cost competitiveness for Indian manufacturers compared to duty-free exporters like Bangladesh and Turkey.
The agreement also encourages greater product innovation and margin stability in a price-sensitive market."
Gems And Jewellery: Gujarat's Shine Set to Sparkle Brighter
Gujarat's thriving gem and jewellery sector, especially Surat, a global hub for diamond cutting and polishing, is set for a boost. Kirit Bhansali, chairman of the Gem & Jewellery Export Promotion Council (GJEPC), anticipates "exports to the UK to rise from $941 million (approx Rs 8,129 crore) to $2.5 billion (approx Rs 21,598 crore) over the next three years due to duty concessions".
Chemicals: Stronger Play in Speciality Exports
Gujarat's chemical industry, accounting for over 45% of India's chemical exports, anticipates improved access to the UK for speciality and fine chemicals. The FTA is expected to simplify regulatory compliance and reduce non-tariff barriers, which often hampered shipments to the EU and UK.
Bhupendra Patel, chairman of Chemexcil (Gujarat), commented: "Chemicals export to the UK is not that significant, but the FTA will help in increasing volume.
Many may start export to Europe through the UK. FTA will provide much-needed competitiveness to Indian exporters against China."
IT & ITeS: Boosting Bilateral Tech Collaboration
Gujarat's growing IT & ITeS industry, particularly in Gandhinagar and Ahmedabad, expects the FTA to unlock smoother visa norms, mutual recognition of qualifications, and easier business mobility. This would bolster tech service exports, consultancy contracts, and fintech collaborations.
Tejinder Oberoi, past chairman of GESIA IT Association, said, "Opening up new markets with higher ticket sizes in addition to a trained talent pool gives our exporters an edge and access to better-value imports. With more tech projects coming our way, we can deliver greater value to clients and grow trade volumes. The FTA will also benefit fintech and semiconductor sectors."
Ceramics Hopeful of Faster Exports Growth
Gujarat's ceramic industry is bullish, too.
Kamlesh Patel, CMD of a leading ceramics company, said that UK ceramic exports have doubled over the past 4–5 years to an estimated $120 million (approx Rs 1,036 crore) in 2024. "The FTA will be a game-changer, offering Indian ceramic products duty-free access. Exports to the UK is likely to double in less than four years," he added.
Pharma Eyes Higher Generic Drugs Exports
The Indian generic drugs manufacturing sector is hopeful of increased exports to the UK. As per industry estimates, the Indian generic drug industry size is around $25 billion (approx Rs 2.15 lakh crore) and 50% of it is exported. Mahendra Patel, chairman of a pharmaceutical company, said, "The FTA will significantly ease regulatory approvals for generic drugs, boosting Indian pharma exports. By improving market access and fostering collaboration, it is poised to enhance India's role as a global hub for high-quality, affordable healthcare solutions.
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