Textiles, footwear, autos among sectors leveraging India-UK FTA to maximise gains: Report
New Delhi, July 15
Indian companies in labour‑intensive sectors such as textiles, garments, footwear, automobiles and marine products were preparing to capitalise on the India‑UK free trade agreement that took effect on Wednesday, a new report has said.
The agreement removes or reduces tariffs on about 99 per cent of Indian exports to the UK, a change that could erase a competitive disadvantage India faced against countries such as Bangladesh and Pakistan, whose goods entered the UK duty‑free under the Developing Countries Trading Scheme, the report from BBC said.
The report cited Dipali Goenka, chief executive of Welspun Living, the Indian company that makes championship towels for Wimbledon said the deal has led to closer planning with British buyers.
She told the media house that many British brands that are their buyers came to India in recent weeks to chart a business roadmap for the next few years. "We typically did joint forward planning only for our U.S. customers, but now, with the deal, it's happening with U.K. clients too," she added.
"If you look at just home textiles, Pakistan's share of UK exports is at around 55 per cent, whereas India's is just 6-7 per cent. That's the gap we can finally cover," she added.
The British government has called the agreement its biggest and most economically significant bilateral trade pact since leaving the European Union.
Analysts said the key beneficiaries are likely to be sectors that previously faced UK tariffs of 4 per cent-16 per cent such as textiles, footwear, carpets, cars, seafood and certain fruits.
These sectors could see higher export orders, larger export volumes and better profit margins, proving the agreement's success, an analyst said.
The overall impact of the deal could likely be "incremental rather than transformational", analysts said, adding that only about 20-30 per cent of India's eligible exports have historically used FTA preferences.
"Historically India's utilisation of FTAs has been low because small businesses are often unaware of the new rules," it noted.
The report cited Global Trade Research Initiative (GTRI) data that India's exports to UK touched $13.4 billion in FY26 and over half of these exports entered the country duty-free under its most favoured nation regime.
— IANS
Reader Comments
Finally a good news for Indian exporters! The 4-16% tariff reduction will make our goods more competitive. I'm particularly happy about marine products - our seafood quality is excellent but pricing was always an issue. Hope this boosts employment in coastal areas. 🐟
Great initiative but I'm cautiously optimistic. The article itself says only 20-30% of eligible exports use FTA preferences. We need better awareness campaigns for MSMEs. Also, the UK is leaving EU - will this deal hold in the long run? Time will tell.
As someone who works in textile exports, this is a game changer. We've already seen increased interest from UK buyers in the last few months. The Wimbledon towel example is perfect - Welspun is showing the way. Let's hope other sectors follow suit.
Good for large corporates but what about the smaller players? The concept of FTA utilization is still new for many Indian businesses. Government should organize workshops in textile hubs like Surat, Tirupur and Ludhiana to ensure everyone benefits.
I'm excited about the auto sector benefits too! Indian auto parts are already competitive, and with tariff removal, we could become a major supplier to UK car makers. Also, carpets from UP and Kashmir will get a boost. Let's make 'Make in India' truly global! 🇮🇳
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