AP-UK natural trade allies
With India and the United Kingdom having signed the Comprehensive Economic and Trade Agreement (CETA) in July this year, businesses from across sectors are looking to leverage the benefits of this bilateral free trade agreement.
CETA provides an unprecedented duty-free access to 99 per cent of India’s exports to the UK, covering nearly 100% of the trade value.
At the same time, India has opened 89.5 % of its tariff lines covering 91% of the UK’s exports. “The India-UK free trade agreement is the most ambitious trade deal between the two countries,” said the Deputy Director Investment South Asia for the Department of Business and Trade, UK, Ms Jennifer Kaul, speaking exclusively to Vizag Industrial Scan.
Ms Kaul, who leads the UK government’s work to support investments from South Asia into the UK, was recently in the city of destiny, Visakhapatnam to meet with businesses and potential investors looking to expand their businesses in UK.
“The United Kingdom is a perfect launchpad for companies wanting to cater to the European market. One can start a business in the UK within an hour,” informed Ms Kaul.
Although the British parliament has yet to approve the India-UK FTA, the deal offers a plethora of opportunities for businesses in both countries.
Some of the big wins for the UK exporters include in alcohol beverages, such as in Scotch Whisky and Spirits, wherein Tariffs will be halved from 150% to 75% immediately, and further reduced to 40% over the next decade, making UK spirits more competitive in the Indian market.
Similarly, in Consumer Goods, Products like cosmetics, medical devices, and food items will see significant tariff reductions, enhancing market access for UK businesses.
Simultaneously, some of the big wins for Indian exporters exporting to the UK will see 99% of Indian exports to the UK enjoy duty-free access, benefiting sectors such as apparel, footwear, marine products, and engineering goods.
AP dominant sectors such as pharmaceuticals and marine exports, too, are set to widely benefit from this trade deal with reduced tariffs. “We believe this FTA will enhance bilateral trade by an additional 25 billion pounds every year,” said Ms Kaul.
State of Andhra Pradesh
The UK investment counsellor also underscored the opportunities that the FTA holds for the state of Andhra Pradesh and the UK.Citing the UK government’s industrial strategy, i.e., invest 2030, she highlighted key sectors for collaboration such as Technology, Advanced manufacturing, Quantum computing, semiconductors, Renewables, etc. “These are very important sectors for the UK, and so they are for Andhra Pradesh too.
Therefore, there is a natural linkage between what the UK is interested in and what AP is interested in,” opined Ms. Kaul.
Emphasising tech, she pointed out that the UK is the biggest tech hub in Europe and the second largest tech hub in the world. “We are very big on Fintech.
We just had the London tech week, wherein we saw a very good representation from AP-based companies,” said the investment counsellor.
The India-UK bilateral annual trade is currently estimated to be at USD 56 billion, with merchandise trade being USD 23 billion and services being USD 33 billion.
