The British and Indian governments have signed a new trade deal to make their respective country’s goods and services cheaper and easier to sell in the other’s marketplace. It is hoped the deal will provide a boost to both economies.
If you are investment planning in Cheshire or the wider UK economy, a number of export sectors stand to benefit from reduced tariffs – in some instances slashed from 100% to 10%. These include medical devices, cosmetics, the whisky industry, high-end vehicles, foods such as salmon, lamb and biscuits, aerospace and electrical machinery.
From a UK perspective, the deal is one of the biggest since exiting the European Union in 2020, following earlier agreements with Australia and Japan and negotiations with around 70 countries worldwide.
While the impact won’t be felt for at least another year when the deal comes into effect, the British government appears confident that it will lead to cheaper prices, and hopeful that lower tariffs in the South Asian market will help offset those introduced in the US.
Moreover, the agreement will enable British companies in India to vie for more services contracts. In return, India will see UK taxes lowered on clothing, footwear, selected food products, jewellery and some car types.
In 2024, trade between India and the UK was worth approximately £42 billion – a figure estimated to increase by a further £25.5 billion per annum by 2040. India is predicted to become the world’s third largest economy, with a huge population and potential customer base.
