India-UK Comprehensive Economic and Trade Agreement

India and the United Kingdom on July 24 signed a landmark Comprehensive Economic and Trade Agreement (CETA), marking the beginning of a new era of economic partnership between the two nations. The agreement was signed by India’s Commerce and Industry Minister, Mr. Piyush Goyal, and the UK’s Secretary of State for Business and Trade, Mr. Jonathan Reynolds, in the presence of Prime Ministers Shri Narendra Modi and Sir Keir Starmer.

Key Highlights of CETA:

• Expanded Trade Opportunities: CETA is designed to unlock significant export opportunities for India, particularly in its labour-intensive sectors such as textiles, leather, and gems & jewellery. These sectors will gain zero-duty access on 99% of tariff lines to the UK market.
• Services Sector Boost: The agreement includes ambitious commitments in the services sector, offering enhanced market access for Indian professionals in various fields like IT, financial services, and education. It also aims to simplify visa procedures for them.
• Double Contribution Convention: A key breakthrough in the agreement is the Double Contribution Convention. This provision exempts Indian workers and their employers from UK social security contributions for up to three years, which is expected to improve take-home pay for workers and reduce costs for employers.
• Economic Goals:
  • The agreement aims to double the bilateral trade between India and the UK by 2030. Currently, this trade stands at nearly USD 56 billion.
  • CETA is expected to create jobs, expand exports, and promote inclusive growth, benefiting a wide range of stakeholders including Micro, Small, and Medium Enterprises (MSMEs), artisans, and women-led enterprises.