India–UK sign Comprehensive Economic and Trade Agreement (CETA)
Kartavya Desk Staff
Syllabus: Bilateral Relations
Source: PIB
Context: India and the United Kingdom signed a historic Comprehensive Economic and Trade Agreement (CETA) and endorsed a long-term strategic blueprint titled India–UK Vision 2035, aimed at strengthening bilateral relations across trade, defence, technology, education, and climate action.
About India–UK sign Comprehensive Economic and Trade Agreement (CETA):
What is the India–UK CETA?
• A Free Trade Agreement (FTA) granting zero-duty access on 99% tariff lines for Indian exports to the UK.
• Covers goods, services, mobility, investment, and social security exemptions under the Double Contribution Convention (DCC).
• Designed to empower labour-intensive sectors, MSMEs, professionals, women, and youth.
Key Provisions of CETA:
• Goods and Market Access:
• Zero-duty access for 99% of tariff lines covering 100% of India’s trade value with the UK.
• Major boost to textiles, gems & jewellery, leather, toys, marine products, and processed food (tariff cut from 70% to 0%).
• Sensitive sectors like dairy protected under exclusion lists.
• Services and Mobility:
• Enhanced access for IT, financial, legal, education, architecture, and consulting services.
• Liberalised visa norms for Contractual Service Suppliers, Intra-Corporate Transferees, and Independent Professionals.
• Mutual recognition of professional qualifications in healthcare, engineering, etc.
• Double Contribution Convention (DCC):
• Exemption from UK social security payments for Indian professionals for 3 years.
• Boosts take-home salary and competitiveness of Indian firms abroad.
• Inclusive Growth Focus:
• Provisions targeting MSMEs, women entrepreneurs, artisans, farmers, youth.
• Access to UK’s $63.4 billion agricultural market for Indian products like spices, tea, coffee, fruits, meat, and dairy (excluding sensitive items).
• Dedicated SME contact points, digital trade facilitation, and paperless customs.
About India–UK Vision 2035:
India–UK Vision 2035 outlines a comprehensive strategic roadmap built on five pillars: Growth, Technology, Defence, Climate, and Education.
• Growth and Jobs
• Doubling bilateral trade from $56 billion by 2030.
• Enhanced investment via BIT, UK-India Infrastructure Financing Bridge, and British International Investment (BII).
• Legal, financial, insurance and asset management sectors to gain from harmonised regulations.
• Technology and Innovation
• Joint centre for AI, collaboration on 6G, semiconductors, biotech, and cybersecurity.
• India–UK Critical Minerals Guild for secure green tech supply chains.
• Boost to startups through catapults, incubators, and biofoundries.
• Defence and Security
• 10-Year Defence Industrial Roadmap covering joint R&D in electric propulsion, underwater systems, and directed energy weapons.
• Elevated 2+2 dialogue, expanded military exercises, and counter-terror cooperation.
• UK’s logistic reliance on India in Indian Ocean Region (IOR).
• Climate and Clean Energy
• Joint action on climate finance, carbon markets, offshore wind, and nuclear collaboration (SMRs).
• Support for ISA, OSOWOG, ZEVTC, and blue carbon research.
• Promotion of Net Zero Innovation Partnership and agroforestry under India-UK Forest Partnership.
• Education and People-to-People Ties
• Opening of UK university campuses in India, dual degree programs.
• Green Skills Partnership to bridge climate-tech skill gaps.
• Implementation of Young Professionals Scheme and mutual recognition of qualifications.
Strategic Significance for India:
Sector | Benefits to India
Trade | Doubling exports, duty-free access, expansion of MSME base
Employment | Job creation in textiles, IT, food processing, and engineering
Youth & Mobility | Enhanced pathways for skilled migration & global careers
Innovation | AI, bio-manufacturing, 6G, quantum, and green hydrogen collaborations
Climate Goals | Green finance, clean tech access, carbon trading schemes
Defence | Boost to self-reliance through co-development in advanced defence tech
Multilateral Reform | Joint stance on UN, WTO, IMF reforms
Conclusion:
India–UK CETA and Vision 2035 mark a watershed moment in bilateral ties—linking trade, mobility, innovation, and strategic collaboration into a unified framework. With inclusive growth, sustainability, and technological leadership at its core, this partnership is set to position India as a key global player in the 21st century.