UK’s whisky, cars will be cheaper in India:Trade deal to be implemented from 15 July; know which items’ prices will change

UK cars, whisky, clothing and footwear will be available cheaper in India after 7 days. Because, the Free Trade Agreement between India-UK will come into effect from July 15. This means from this day, 99% of India’s goods will be exported to UK at zero tariff. Meanwhile, 99% of UK’s goods will be imported at 3% average tariff. This is expected to double bilateral trade to $120 billion by 2030. After 14 rounds of talks over nearly 3 years, Commerce Minister Piyush Goyal and British Trade Minister Jonathan Reynolds signed this agreement on July 24, 2025 in the presence of PM Narendra Modi and his UK counterpart Keir Starmer. British High Commissioner called it a ‘historic moment’ Before this trade agreement comes into effect, businesses and companies of both countries have less than a month left to prepare. UK High Commissioner to India Lindy Cameron wrote on social media platform X, “The countdown has begun! UK and India have agreed that the Free Trade Agreement will come into effect from July 15. This is a historic moment for the modern UK-India partnership, which will mark the beginning of a new era of growth for both our economies.” Understand the benefits of this agreement through QA: Question 1: Which items will become cheaper in India? Answer: The average tariff on goods imported from the UK will reduce from 15% to 3%. 85% of goods will become completely tariff-free within 10 years. This will make many items cheaper: Question 2: Which sectors of India will benefit? Answer: Sectors ranging from textiles to engineering, medical and chemical will benefit. 1. Textile Sector Indian clothing and home textiles like bedsheets and curtains used to have an 8-12% tax in the UK, which will now be completely eliminated. This will make our textiles cheaper and more competitive compared to countries like Bangladesh and Vietnam. Export hubs like Tiruppur, Surat, and Ludhiana could see growth of up to 40% in the next three years. 2. Jewellery and Leather Goods There will now be no tax on jewelry and leather goods like bags and shoes going from India to the UK. This will greatly benefit small businesses (MSMEs) and luxury brands. Additionally, India’s dominance in Europe through the UK route will increase further. 3. Engineering Goods and Auto Parts The UK has eliminated import tax on Indian machinery, engineering tools, and auto parts like car components. This will strengthen India’s position in the UK and European industrial supply chain. Manufacturing hubs like Pune, Chennai, and Gurugram will benefit. 4. Medicines and Medical Devices Indian pharma companies will get an easier registration process for generic medicines in the UK. This will help Indian medicines reach the UK’s health service (NHS) more easily and drug approvals will also be faster. 6. Food and beverages, tea, spices and marine products UK import tax on basmati rice, marine products like prawns, premium tea and spices will be eliminated. This will give a major boost to the export industry of regions like Assam, Gujarat, Kerala and West Bengal. 7. Chemicals and specialty materials Reduction in tax on agrochemicals, plastics and specialty chemicals will boost exports from major hubs like Gujarat and Maharashtra. Under this deal, India’s target is to double its chemical exports to the UK by 2030. 8. Green energy and cleantech This agreement will pave the way for joint ventures in renewable energy, including solar, green hydrogen and electric vehicle (EV) infrastructure. The UK will invest further in India’s clean energy sector, leading to co-development of new technologies. Question 3: What benefits will this deal bring to India’s economy? Answer: The FTA is beneficial for India’s economy in several ways: Question 4: When will this agreement come into effect? Answer: This agreement was signed on 24 July 2025, but it may take about a year to be implemented. This is because approval from India’s Central Cabinet and UK’s Parliament is necessary. It has already received approval from India’s Central Cabinet. Question 5: When did the negotiations between India and UK regarding the agreement begin? Answer: The negotiations between India and UK regarding the agreement began on January 13, 2022, which concluded after approximately 3.5 years. Since 2014, India has signed 3 such Free Trade Agreements with Mauritius, UAE, Australia and EFTA (European Free Trade Association). India is actively negotiating similar agreements with the European Union (EU). Question 6: How many types of trade agreements are there? Answer: Free Trade Agreements are given different names according to their nature. These include PTA (Preferential), RTA (Regional) and BTA (Bilateral). WTO names all such economic engagements as RTA. Question 7: With which countries has India signed these agreements? Answer: India has signed trade agreements with Sri Lanka, Bhutan, Thailand, Singapore, Malaysia, Korea, Japan, Australia, UAE, Mauritius, ASEAN and EFTA blocks. According to Global Trade Research Initiative (GTRI), after securing deals with Asia’s major economies, India has shifted its FTA focus from East (ASEAN, Japan, Korea) towards Western partners. India is now prioritizing FTAs with the EU and US to expand exports and strengthen trade relations with major economies of the West.