UK-India trade deal countdown opens new window for exporters

The UK and India have confirmed that their free trade agreement will enter into force on 15 July, giving exporters less than a month to prepare for one of the most commercially significant trade deals signed by the UK since Brexit.

The Department for Business and Trade said companies will be able to trade under the agreement’s terms from next month, following work to prepare UK and Indian systems.

The deal is expected by the UK government to increase bilateral trade by £25.5bn a year in the long run, lift UK GDP by £4.8bn and raise real wages by £2.2bn.

For exporters, the most immediate impact will come through tariff reductions. Whisky tariffs are set to fall from 150% to 40%, automotive tariffs from 100% to 10% under a quota, while tariffs on cosmetics of up to 22% will be removed either from day one or over a 10-year period.

The government said businesses planning to use the agreement will need to register with HMRC to benefit from tariff reductions.

For trade finance providers, the countdown matters because lower tariffs and clearer rules can support higher trade volumes, new buyer relationships and stronger demand for working capital facilities.

The agreement may also increase demand for documentary trade, credit insurance and receivables-backed funding as exporters adjust to new commercial terms.

While the deal was signed last year, confirmation of the entry-into-force date is the fresh operational milestone. Banks and exporters now have a fixed date around which to prepare finance, logistics and compliance processes.