During Prime Minister Narendra Modi’s visit to London, the much-awaited Free Trade Agreement (FTA) is going to be signed between India and Britain. This agreement will give new impetus to trade between the two countries and common consumers will be able to get many products at cheaper rates…
What is India-UK Free Trade Deal: Prime Minister Narendra Modi ‘s visit to London is going to prove to be historic for the Indian economy. During this time, the signing of the Free Trade Agreement (FTA) between India and Britain is certain. This agreement, which is being done after years of discussions, will not only accelerate the trade between the two countries, but many products are going to become cheaper for the common consumer.
What is the meaning of free trade agreement?
Free trade agreement means reducing or eliminating tariffs or custom duty between two countries so that it becomes easier to buy and sell goods. This increases trade and the products of both countries are available cheaper in each other’s markets. Under India-UK FTA, India will get the right to tax free export to UK on 99 percent of its export items. At the same time, India will reduce tariffs on 90 percent of products coming from UK. This means that many goods like electronics, clothes, and jewelry coming from UK can become cheaper. New markets can also open up for garments, jewelry, textiles and marine products going from India to UK.
What will be cheaper, what will be expensive?
| stuff | Potential impact | Why? |
|---|---|---|
| Electronics | Cheap | Lower tariffs from the UK will make imports easier |
| Textiles and fashion | Cheap | Lower tariffs, more choice and competition |
| Medicines | Would be nice (expensive/cheap both possible) | Dependence on import-export policies |
| Agricultural Products(Paddy, Wheat) | Stable or expensive | Affected by conservation rules |
| Automobiles (cars, bikes) | Can be expensive | Competition and tariff changes |
| Steel and metals | Costly | Competition from high quality products from the UK |
What will be the benefit to the common man?
However, this does not mean that everything will become cheaper. There will be no major change in the prices of some essential agricultural products like paddy and wheat as protection has been maintained in this sector. At the same time, some items coming from the UK like cars and steel may become expensive because of new competition and custom rules in the market.
The benefit of this agreement for the common man will be that some items of daily needs like electronic gadgets, clothes and shoes can be available at lower prices. At the same time, employment opportunities will also increase due to the boom in business of industries. Due to this, economic development will also get a boost.
Overall, the India-UK Free Trade Agreement will improve trade between the two countries. Some items will become cheaper while some will become expensive. This will affect your daily expenses and employment opportunities. Therefore, it is important that you know about this agreement wisely and consider your pros and cons.