India's recent trade deals with UAE, Switzerland, and now UK marks policy shift: GTRI
(You can now subscribe to our
(You can now subscribe to our Economic Times WhatsApp channel
India's recent trade deals with UAE, Switzerland, and now with United Kingdom marks a significant shift in its approach to free trade agreements (FTAs) as India is gradually opening up sensitive areas that were earlier off-limits, according to a report by Global Trade Research Initiative (GTRI).The report highlighted that these areas are government procurement, intellectual property rights, automobile, data and services.The UK agreement is particularly notable because it pushes past long-standing red lines that India had maintained on domestic regulation and policy space. As India continues to negotiate with countries like the US and EU, these changes could set important precedents.GTRI said "India's recent trade deals--with the UAE, Switzerland, and now the UK--are following a pattern. Each agreement goes deeper into sensitive areas, opening up new sectors, and giving up control over important policy spaces"One of the most significant features of the India-UK FTA is the introduction of a Tariff Rate Quota (TRQ) system for UK-made passenger cars.This is India's first-ever automobile tariff concession in any trade agreement. Under this, India has agreed to reduce customs duty on large-engine petrol cars (above 3000 cc) and diesel cars (above 2500 cc), typically high-end luxury vehicles, from over 100 percent to just 10 percent over a period of 15 years.The quota for such imports will start at 10,000 units and rise to 19,000 units by the fifth year.While these reduced duties apply only to vehicles within the TRQ quota, those outside the quota will continue to face high tariffs ranging from 95 percent to 50 percent depending on the vehicle type and year.This creates a preferential path for UK brands like Jaguar and Land Rover, owned by Tata Motors, and could invite similar demands from other trade partners like Japan, the EU, South Korea, and the US.The India UK agreement also brings major changes in the government procurement space.For the first time, India has agreed to open around 40,000 high-value contracts from central ministries and departments to UK bidders.These contracts span sectors like transport, green energy, and infrastructure. This marks a sharp departure from India's traditionally protectionist approach in public procurement and signals greater openness in the future.In the Intellectual Property chapter, India has made a major concession by accepting language that could restrict its ability to issue compulsory licenses, a key tool used during public health emergencies to make life-saving medicines and technologies more affordable.India has agreed to include wording that stresses the need for "adequate remuneration" to patent holders, aligning with Article 31(h) of the TRIPS Agreement.Although this principle already exists in global IP norms, its explicit inclusion in a bilateral agreement makes it a binding obligation and could limit India's policy flexibility under domestic law.India has also opened up important segments of its services economy to British firms.These include accounting, auditing, financial services (with FDI in insurance capped at 74 per cent), telecom (allowing 100 per cent FDI), environmental services, and auxiliary air transport.UK companies can now offer services like telecom and construction in India without establishing a local presence, and they will receive national treatment, meaning they will be treated the same as Indian companies.India has also agreed to recognize UK professional qualifications in fields such as law and accounting, although the legal services market remains closed.Overall, the GTRI noted that India-UK trade agreement is more than just a commercial deal, it reflects a shift in India's trade policy, where it is beginning to allow greater foreign access in key sectors.While these moves open up new economic opportunities, they also bring challenges and set precedents that could shape India's future trade relationships with other global partners.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Economic Times
8 minutes ago
- Economic Times
Don't short this market; better days ahead post tariff resolution: Ajay Bagga
Live Events (You can now subscribe to our (You can now subscribe to our ETMarkets WhatsApp channel "So far, there have been broad disappointments—except perhaps refining margins, which have performed better. But overall, margins have declined across most sectors. Even in banking, we've seen higher provisions and lower margins due to rate cuts. So overall: disappointing earnings, high valuations, and unsupportive global cues—that's the current story of the Indian markets ," says Ajay Bagga , Market three major factors were pressuring the Indian markets on Friday. If we look globally, markets were down—MSCI Asia closed 1% lower, MSCI Europe, midway through the session, was down about 0.6%, and MSCI Emerging Markets were down 0.7%. So, the correction was reason behind this is, firstly, the strong recovery from April onwards. We saw a dip approaching the July deadlines, which were then rolled over to August 1st. As we approach that date, markets are reacting to the heavy news flow expected next week, including the Fed meeting and the August 1st deadline. Global markets are a bit cautious, and Indian markets are reflecting this is the fourth consecutive week of decline for the Nifty , largely driven by FPI selling, which is more due to valuation concerns. Nifty's one-year forward P/E is still around 23.5 times. The expectation was that, given last year's slowdown from March to September, this year's June YoY numbers would benefit from the base effect, and we'd see double-digit overall earnings growth—but that hasn't far, there have been broad disappointments—except perhaps refining margins, which have performed better. But overall, margins have declined across most sectors. Even in banking, we've seen higher provisions and lower margins due to rate cuts. So overall: disappointing earnings, high valuations, and unsupportive global cues—that's the current story of the Indian a confusing market. Let me give you two quick pharma. Despite President Trump promising tariffs on pharma by the end of the week, we saw a rally in the sector on Friday. That's puzzling, as pharma is one of the sectors most at risk this look at the broader market: ₹1.5 lakh crore worth of shares have been offloaded by promoters and PE funds with minimal impact cost. The market has absorbed it. The primary market is in a frenzy—we are headed for a historic high in fundraises. The QIP for the biggest bank came in at ₹25,000 crore and attracted bids worth over ₹1 lakh there's ample liquidity and appetite. Retail investors are providing an exit to FPIs. It's a bipolar market—retailers are buying while institutions are exiting, and that sentiment is keeping the market resilient. When this sentiment shifts—and a big trigger could be the India-US tariff announcement expected around mid to late August—there could be a major FPI short squeeze (currently 85% net short).So, I wouldn't recommend shorting this market. I'd recommend having faith in it. We'll see better days once the uncertainty around US tariffs is the UK FTA, the UK Parliament has approved it, but it may take a year to implement. So, let's wait and see. It'll benefit labour-intensive sectors like textiles, leather, gems and jewellery, small machinery, chemicals, organics, and seafood. Indian professionals working in the UK on short-term visas could save an estimated ₹4,000 crore annually—a significant it's a positive development, but the markets haven't reacted much yet—possibly because implementation details are still unclear, and the UK Parliament has yet to finalise surprising how auto stocks started moving up mid-week. I was taken aback because the fundamentals are quite weak. Demand is suffering. The only bright spots are tractors and possibly India, there's a divide: urban consumption is still challenged, while rural consumption is relatively strong. So, auto companies that cater to rural markets will do better. Tractor sales are expected to cross 1 million this year—that's a good sign, and we should see better margins for tractor motorcycles—are mostly sold in semi-urban and rural areas (60-70%). They should perform well. Once the harvest season arrives in October, we could see further the rest of the segment is under pressure. We're facing risks from Chinese rare earth exports—EV production has already been cut in July and could halt in August if we don't get essential components like top of that, the Trump tariffs—25% on auto and auto ancillaries—are already in place. Global auto majors like Volvo, Volkswagen, Stellantis, and GM have each estimated earnings hits between $500 million and $1 billion due to these tariffs. So, it's hard to see how smaller Indian players will escape the fallout.I wouldn't bet on the auto segment just yet—unless India secures a carve-out similar to Japan's 15% tariff. If we get that, auto stocks could rally. But as of now, it's a binary and difficult decision. Fundamentals are weak, but news flow could flip the I'd say: start nibbling slowly, but wait till August. Once there's more clarity on India's tariff treatment, especially from the US, we'll have a better sense of direction.
The Hindu
8 minutes ago
- The Hindu
Meta to halt political advertising in EU from October, blames EU rules
Meta Platforms will end political, electoral, social issue advertising on its platform in the European Union in early October because of the legal uncertainties due to EU rules targeting political advertising, the U.S. social media company said on Friday. Meta's announcement echoed Alphabet unit Google's decision announced last November, underscoring Big Tech's pushback against EU rules aimed at reining in their power and making sure that they are more accountable and transparent. The European Union legislation, called the Transparency and Targeting of Political Advertising (TTPA) regulation and which will apply from Oct. 10, was triggered by concerns about disinformation and foreign interference in elections across the 27-country bloc. The EU law requires Big Tech companies to clearly label political advertising on their platforms, who paid for it and how much as well as which elections are being targeted or risk fines up to 6% of their annual turnover. "From early October 2025, we will no longer allow political, electoral and social issue ads on our platforms in the EU," Meta said in a blog post. "This is a difficult decision - one we've taken in response to the EU's incoming Transparency and Targeting of Political Advertising (TTPA) regulation, which introduces significant operational challenges and legal uncertainties," it said. Meta said TTPA obligations create what it said is an untenable level of complexity and legal uncertainty for advertisers and platforms operating in the EU. It said the EU rules will ultimately hurt Europeans. "We believe that personalised ads are critical to a wide range of advertisers, including those engaged on campaigns to inform voters about important social issues that shape public discourse," Meta said. "Regulations, like the TTPA, significantly undermine our ability to offer these services, not only impacting effectiveness of advertisers' outreach but also the ability of voters to access comprehensive information," the company added.
Time of India
8 minutes ago
- Time of India
From 'Show Proof' To 'No Objection': Pak's Stunning U-Turn On TRF Linked To Pahalgam Terror Attack
'We Can Use English Words': PM Modi Steps In As Translator Struggles With Hindi During UK Presser During a joint press conference with UK Prime Minister Keir Starmer, Prime Minister Narendra Modi stepped in to ease a Hindi translator's struggle while translating Starmer's remarks. Modi calmly told the translator, 'Use English words in between… don't worry,' and reassured him with a warm 'No problem' when he apologised. The light-hearted moment occurred after India and the UK signed a long-awaited Free Trade Agreement aimed at enhancing bilateral trade and investment. PM Modi also used a cricket analogy, saying the India-UK partnership is like a game played with a straight bat—solid, passionate, and always aiming for high scores.#modiukvisit #indiaukfta #tradedeal #modi #starmer #modistarmer #cricketdiplomacy #bilateralrelations #freetrade #economiccooperation #diplomacy #globalpartnerships #viral #trending #viralnews #toi #toibharat 57.7K views | 1 day ago
