What is the Big Deal?
The India-UK Comprehensive Economic and Trade Agreement (CETA) is one of India's most ambitious trade pacts. Signed in July 2025 and coming into force a year later, it aims to significantly reduce or eliminate tariffs, ease the path for services trade,
and clarify rules for businesses. The goal is ambitious: to more than double bilateral trade from current levels by 2030. For the UK, it represents a major post-Brexit trade achievement, while for India, it unlocks preferential access to the world's sixth-largest economy. The agreement is extensive, covering everything from goods and services to digital trade and government procurement.
Tariff Cuts and Exports
A major win for India is the massive reduction in UK import duties. The deal grants immediate duty-free access for nearly 99% of Indian exports to the UK. This is a huge boost for labour-intensive sectors like textiles and garments, leather, and footwear, where tariffs of up to 16% have been removed. India's engineering goods, auto components, and marine products also see significant duties eliminated. For food exports, tariffs on many processed food items are gone, though India has protected sensitive domestic sectors like dairy, sugar, and certain grains from reciprocal cuts. In return, India will phase in tariff reductions on 90% of UK goods, including Scotch whisky, where the notoriously high 150% duty falls immediately to 75% and will decrease further over ten years.
Greater Access for Services
India is a global powerhouse in the services sector, and a key demand during negotiations was improved market access for its firms and professionals. The agreement provides greater regulatory certainty for Indian companies in fields like IT, financial services, healthcare, and education operating in the UK. While the deal does not create new, open-ended work visa routes, it does formalise and expand provisions for temporary business mobility. This includes clearer rules for business visitors and intra-company transferees, making it easier for Indian companies to send their employees to the UK for specific projects. The UK has also expanded access for some independent professionals like architects and engineers.
The Social Security Breakthrough
A significant and connected part of the deal is the Double Contribution Convention (DCC), a social security agreement that also took effect on July 15. Previously, Indian professionals on temporary assignments in the UK had to contribute to the UK's National Insurance system, often without being able to claim benefits if they left within a few years. The DCC resolves this by allowing Indian employees on temporary assignments of up to five years (60 months) to continue paying into India's Employees' Provident Fund (EPF) instead of making UK social security contributions. This prevents a double financial burden and ensures that their retirement savings remain consolidated in their home country, a major win for India's skilled workforce.
UK Work Assignments Explained
While there was much speculation, the FTA does not grant broad, new visa rights for Indians to work in the UK. The UK's points-based immigration system remains firmly in place. Instead, the deal focuses on facilitating temporary business travel under existing visa frameworks, like the Global Business Mobility routes. It essentially locks in and, in some cases, expands access for Indian companies to send contractual service suppliers to the UK. A specific, limited quota has been set for some professions like chefs and yoga instructors, but this is far from the wide-ranging visa liberalisation some had hoped for. The core purpose is to make it more predictable for businesses to move talent temporarily, not to change fundamental immigration policies.
