India-UK FTA Offers Immense Promise For Our Youth & Industry

India's free trade agreement (FTA) with the UK can benefit both countries, but both will have to strive hard to tap that potential. The FTA ensures comprehensive market access for goods, across all sectors, covering all of India's export interests, an Indian government release said. "India will gain from tariff elimination on about 99 per cent of the tariff lines covering almost 100 per cent of the trade value offering huge opportunities for an increase in the bilateral trade between India and the UK."

London is also bullish about the pact that took years to take a concrete shape. It expects the FTA to add £4.8 billion (0.1per cent) to UK GDP "every year in the long term. Workers will benefit from wages growing by a further estimated £2.2 billion every year in the long term." It is also excited about the fact that the FTA gives UK businesses "unique and unprecedented access to India's public procurement market, comprising approximately 40,000 tenders with a value of at least £38 billion a year." Beyond securing new market access for goods and services exports, the UK believes, this deal will also make it easier for UK businesses to trade with and in the Indian market.

For India, the agreement is poised to benefit its manufacturing sector, particularly in labor significantly- and technology-intensive industries. Sectors such as textiles, marine products, leather, footwear, sports goods, toys, gems and jewellery, engineering goods, auto parts, and organic chemicals stand to gain a competitive edge in the UK market. By making Indian goods more cost-competitive in comparison to products from other countries, the FTA is expected to drive export growth and industrial development.

The FTA also carries substantial implications for job creation in India. A major strength of the agreement is the UK's strong service sector commitment, which is particularly beneficial to India's prowess in IT/ITeS, financial services, professional services, business support, and educational services. These sectors are expected to witness an influx of new opportunities, bolstering employment and economic output in India.

Additionally, the FTA facilitates greater mobility for Indian professionals, including contractual service suppliers, business visitors, investors, and intra-corporate transferees. It also includes provisions for their partners and dependent children to work in the UK, which adds a human dimension to the economic pact. Independent professionals such as yoga instructors, musicians, and chefs also benefit from enhanced access to the UK market.

Given the UK's status as a global hub for digitally delivered services, the agreement unlocks immense possibilities for Indian youth, particularly in sectors like architecture, engineering, computer-related services, and telecommunications. With India securing key digital service commitments, Indian service providers will find an enabling environment to thrive in the UK.

A notable financial benefit is the exemption from social security contributions for Indian workers temporarily stationed in the UK under the Double Contribution Convention. This provision will enhance the cost competitiveness of Indian service providers while offering tangible financial relief to both employees and employers.

However, while the FTA is rich in potential, its success will hinge on the quality of its implementation. Authorities in India must act proactively to cut through red tape and ensure that procedural delays and administrative inefficiencies do not undermine the agreement's benefits. Efficient execution is the sine qua non of the FTA's success.