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Economic Times
9 hours ago
- Business
- Economic Times
India-UK FTA to include co-equal origin provision; product-specific norms to offer flexibility
AI generated image The draft India–UK free trade agreement (FTA) has introduced a 'coequal' rule or product-specific origin norms to offer greater flexibility to specific goods, said people aware of the matter. The rule will allow the producer of a good to meet any of the criteria of origin to claim benefits under the FTA. The origin rules are vital for checking any circumvention of the trade agreement rules and the flow of substandard imports into India. India's FTA with the UK is different from its earlier trade agreements, which had simple rules of origin linked to the wholly-obtained criterion from the trade partner country, value-added norms, or changes in the tariff heading parameter, which meant transformation of a product leading to a change in its duty classification. However, the rules are getting more complex and offer greater flexibility to specific goods, known as the 'co-equality' of rules. The India–UK FTA will feature the digital exchange of certificates of origin on a self-certification basis for the first time under such a trade accord. 'This deal secures rules of origin to facilitate improved access to both sides. Co-equal rules will allow a producer of a good to meet any of the criteria of origin to claim benefit under the FTA,' said one person aware of the development. Product-specific rules of origin in the current interconnected global supply chains can help to mitigate any misuse of duty concessions given by India, said Bipin Sapra, partner, EY. The conclusion of FTA negotiations between India and the UK was announced on May 6. The agreement is expected to be signed soon after which it will be made public. It will then be ratified by both countries before coming into force. To qualify for reduced tariffs, the rules of origin specify that a product must either be wholly obtained or significantly transformed through processing in either the UK or India. The chapter on origin rules also provides robust mechanisms for compliance to be checked. 'If risk parameters find an issue in a product, then checks will be carried out,' said another official. Such co-equal origin norms are being considered in the India–EU FTA as well. The EU had suggested some processes related to spun yarn for determining whether textiles are of European or Indian origin to enjoy duty benefits. India has said that 99% of its exports to the UK will benefit from zero duty and that the FTA opens up significant export opportunities for labour-intensive sectors such as textiles, marine products, leather, footwear, sports goods and toys, gems and jewellery, engineering goods, auto parts and engines, and organic chemicals. As per the UK, the agreement will cut Indian tariffs on 90% of product lines, with 85% of those becoming fully tariff-free within a decade.
Time of India
9 hours ago
- Business
- Time of India
India-UK FTA to include co-equal origin provision; product-specific norms to offer flexibility
Access to reduced tariffs Live Events (You can now subscribe to our (You can now subscribe to our Economic Times WhatsApp channel The draft India–UK free trade agreement (FTA) has introduced a 'coequal' rule or product-specific origin norms to offer greater flexibility to specific goods, said people aware of the matter. The rule will allow the producer of a good to meet any of the criteria of origin to claim benefits under the origin rules are vital for checking any circumvention of the trade agreement rules and the flow of substandard imports into FTA with the UK is different from its earlier trade agreements, which had simple rules of origin linked to the wholly-obtained criterion from the trade partner country, value-added norms, or changes in the tariff heading parameter, which meant transformation of a product leading to a change in its duty the rules are getting more complex and offer greater flexibility to specific goods, known as the 'co-equality' of India–UK FTA will feature the digital exchange of certificates of origin on a self-certification basis for the first time under such a trade accord.'This deal secures rules of origin to facilitate improved access to both sides. Co-equal rules will allow a producer of a good to meet any of the criteria of origin to claim benefit under the FTA,' said one person aware of the rules of origin in the current interconnected global supply chains can help to mitigate any misuse of duty concessions given by India, said Bipin Sapra, partner, conclusion of FTA negotiations between India and the UK was announced on May 6. The agreement is expected to be signed soon after which it will be made public. It will then be ratified by both countries before coming into qualify for reduced tariffs, the rules of origin specify that a product must either be wholly obtained or significantly transformed through processing in either the UK or India. The chapter on origin rules also provides robust mechanisms for compliance to be checked.'If risk parameters find an issue in a product, then checks will be carried out,' said another co-equal origin norms are being considered in the India–EU FTA as well. The EU had suggested some processes related to spun yarn for determining whether textiles are of European or Indian origin to enjoy duty has said that 99% of its exports to the UK will benefit from zero duty and that the FTA opens up significant export opportunities for labour-intensive sectors such as textiles, marine products, leather, footwear, sports goods and toys, gems and jewellery, engineering goods, auto parts and engines, and organic per the UK, the agreement will cut Indian tariffs on 90% of product lines, with 85% of those becoming fully tariff-free within a decade.
Time of India
08-05-2025
- Business
- Time of India
Cheaper chocolates, cosmetics, soft drinks from UK no threat to India's local industry
India's free trade agreement (FTA) with the UK will allow imports of cosmetics, soft drinks and chocolates at concessional duties but officials ruled out any surge in their shipments that could impact domestic industry. However, Scotch whisky imports are expected to grow as India has halved the tariffs to 75 per cent immediately and 40 per cent after ten years of the agreement. 'There is not much concern on chocolates, cosmetics and even Scotch imports. We don't expect a huge rise in their imports that could hurt our domestic industry,' said an official. India's imports from the UK were USD 7.28 billion in April-January FY25 with those of precious and semiprecious stones at USD 2.2 billion, nuclear reactors and boilers at USD 1.2 billion, medical and surgical instruments at USD 311 million, and beverages and spirits at USD 307.95 million. 'Through this deal, tariffs on soaps, shaving cream, face cream and nail polish will either be removed on day one or removed after staging over 10 years. In addition, perfumes and eau de cologne will see tariffs of 20 per cent halved after staging, increasing the opportunity for exporters and reducing costs,' the UK said in a statement. As soon as the FTA comes into force, 64 per cent of tariff lines or product categories such as advanced manufacturing such as aircraft parts, and fresh and frozen salmon from the UK will be eligible for tariff-free imports into India, the UK said. After 10 years, chocolate, sweet biscuits, soft drinks and non-alcoholic beer would get tariff-free access into India. 'The FTA will encourage imports but Indian industry would continue to remain competitive in sectors such as chocolates and cosmetics,' said Bipin Sapra, tax partner, EY India. Scotch whisky exports to India by £1 billion over the next five years from over £200 million in 2022. Scotch accounts for around 2.5 per cent of India's whisky market. 'We are giving signals to the EU that we are open to offer concessions,' the official said. The next round of India-EU talks is scheduled next week.
Time of India
08-05-2025
- Business
- Time of India
Cheaper chocolates, cosmetics, soft drinks from UK no threat to India's local industry
Live Events (You can now subscribe to our (You can now subscribe to our Economic Times WhatsApp channel India's free trade agreement (FTA) with the UK will allow imports of cosmetics, soft drinks and chocolates at concessional duties but officials ruled out any surge in their shipments that could impact domestic industry. However, Scotch whisky imports are expected to grow as India has halved the tariffs to 75% immediately and 40% after ten years of the agreement.'There is not much concern on chocolates, cosmetics and even Scotch imports. We don't expect a huge rise in their imports that could hurt our domestic industry,' said an imports from the UK were $7.28 billion in April-January FY25 with those of precious and semiprecious stones at $2.2 billion, nuclear reactors and boilers at $1.2 billion, medical and surgical instruments at $311 million, and beverages and spirits at $307.95 million.'Through this deal, tariffs on soaps, shaving cream, face cream and nail polish will either be removed on day one or removed after staging over 10 years. In addition, perfumes and eau de cologne will see tariffs of 20% halved after staging, increasing the opportunity for exporters and reducing costs,' the UK said in a soon as the FTA comes into force, 64% of tariff lines or product categories such as advanced manufacturing such as aircraft parts, and fresh and frozen salmon from the UK will be eligible for tariff-free imports into India, the UK said. After 10 years, chocolate, sweet biscuits, soft drinks and non-alcoholic beer would get tariff-free access into India.'The FTA will encourage imports but Indian industry would continue to remain competitive in sectors such as chocolates and cosmetics,' said Bipin Sapra, tax partner, EY whisky exports to India by £1 billion over the next five years from over £200 million in 2022. Scotch accounts for around 2.5% of India's whisky market.'We are giving signals to the EU that we are open to offer concessions,' the official next round of India-EU talks is scheduled next week.
