CETA removes tariffs on 1,143 specific textile tariff lines, removing previous duties of up to 12%.
Under the agreement, 99% of Indian goods entering the UK and 90% of UK goods entering India will qualify for duty-free or reduced-tariff treatment. The deal is projected to boost annual bilateral trade by £25.5bn, with annual GDP gains of £5.1bn for India and £4.8bn for the UK.
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According to India’s Ministry of Commerce & Industry, the affected tariff lines account for 11.7% of sector exports. It hopes the changes will improve India’s position relative to suppliers based in Bangladesh, Pakistan and Cambodia, which already benefit from duty-free status in the UK.
India is currently the UK’s fourth-largest textile supplier, with a 6.1% market share and around $1.79bn in annual exports. UK imports of textiles and clothing exceeded $28.8bn last year.
CETA is expected to provide a major stimulus for Indian ready-made garment manufacturers.
In a statement shared on social media, India’s Department of Commerce said: “The India–UK CETA opens new pathways for textile exporters with zero-duty access across 1,143 tariff lines, eliminating tariff disadvantages and enhancing competitiveness in the UK market.
“With strong potential across ready-made garments, home textiles, carpets and handicrafts, the agreement will help Indian textiles expand their global footprint and strengthen India’s position as a leading textile supplier.”
The agreement also introduces streamlined customs procedures and eliminates the mandatory need for customs brokers, with businesses able to access preferential rates after registering with HMRC in the UK.
UK Trade Commissioner for South Asia and British Deputy High Commissioner for Western India Harjinder Kang added: “This is a watershed moment for the UK-India partnership. As the landmark trade deal comes into force, what better than having select British products arriving in one of the very first UK flights into India this morning—with thanks to support from British Airways.
“Our landmark trade deal is designed to benefit businesses and consumers from day one with cheaper, quicker and easier trade. We are all excited to take full advantage of it.”
