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New Delhi, July 25 (KNN) India’s recently concluded free trade agreement (FTA) with the United Kingdom, following similar deals with the UAE and Switzerland, marks a strategic turning point in the country’s trade policy, according to an analysis by the Global Trade Research Initiative (GTRI).
GTRI observes that India is gradually opening up sensitive sectors—long considered off-limits—to greater foreign access and commitments.
In particular, the India–UK Comprehensive Economic and Trade Agreement (CETA) breaks new ground in key areas such as government procurement, intellectual property rights, automobiles, data, and services.
These developments, GTRI suggests, reflect a broader trend in India’s recent trade engagements, moving toward deeper economic integration and greater reciprocity.
For the first time in any trade pact, India has offered tariff concessions on automobiles.
Under a Tariff Rate Quota (TRQ), India will gradually lower duties on UK-manufactured high-end petrol and diesel vehicles (engine capacity above 3000cc and 2500cc respectively) from over 100 percent to 10 percent over 15 years.
The quota begins with 10,000 units and rises to 19,000 units by the fifth year.
This preferential treatment will benefit UK-based carmakers, notably Jaguar Land Rover, owned by India’s Tata Motors.
However, GTRI warns the move could lead to similar demands from other trade partners including Japan, South Korea, the EU, and the US, potentially reshaping India’s protective automotive policy.
The agreement also marks a significant shift in India’s traditionally cautious stance on public procurement.
For the first time, India has agreed to open up approximately 40,000 high-value central government contracts to UK bidders.
These contracts span sectors such as transportation, renewable energy, and infrastructure, signalling a notable departure from India’s prior emphasis on domestic sourcing in public projects.
The FTA grants greater access to British firms in India’s services economy, particularly in accounting, auditing, finance, telecom, environmental services, and auxiliary air transport.
UK firms will be allowed to operate without local presence in many of these sectors and will enjoy national treatment, ensuring they are treated on par with Indian firms.
India has also agreed to recognise UK professional qualifications in areas such as law and accounting, although the legal services market remains formally closed.
GTRI underlines that the India–UK FTA reflects more than commercial intent—it signals a paradigm shift in India’s trade posture.
“Each agreement is going deeper into sensitive areas, opening new sectors, and giving up control over key policy spaces,” the report states.
As India continues negotiations with the United States, European Union, and other partners, the concessions made in the UK agreement could set influential precedents.
While the agreement unlocks new economic opportunities and aligns with India’s ambition to integrate with global markets, it also presents policy challenges, particularly in maintaining regulatory autonomy and managing domestic sensitivities.
As GTRI concludes, the India–UK agreement is “more than just a trade deal—it is a template that could define India’s approach to global economic engagement in the coming decade.”
(KNN Bureau)
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