India’s free trade agreement (FTA) with the UK will allow imports of cosmetics, soft drinks and chocolates at concessional duties but officials ruled out any surge in their shipments that could impact domestic industry. However, Scotch whisky imports are expected to grow as India has halved the tariffs to 75% immediately and 40% after ten years of the agreement.
“There is not much concern on chocolates, cosmetics and even Scotch imports. We don’t expect a huge rise in their imports that could hurt our domestic industry,” said an official.
India’s imports from the UK were $7.28 billion in April-January FY25 with those of precious and semiprecious stones at $2.2 billion, nuclear reactors and boilers at $1.2 billion, medical and surgical instruments at $311 million, and beverages and spirits at $307.95 million.
“Through this deal, tariffs on soaps, shaving cream, face cream and nail polish will either be removed on day one or removed after staging over 10 years. In addition, perfumes and eau de cologne will see tariffs of 20% halved after staging, increasing the opportunity for exporters and reducing costs,” the UK said in a statement.
As soon as the FTA comes into force, 64% of tariff lines or product categories such as advanced manufacturing such as aircraft parts, and fresh and frozen salmon from the UK will be eligible for tariff-free imports into India, the UK said. After 10 years, chocolate, sweet biscuits, soft drinks and non-alcoholic beer would get tariff-free access into India.
“The FTA will encourage imports but Indian industry would continue to remain competitive in sectors such as chocolates and cosmetics,” said Bipin Sapra, tax partner, EY India.
Scotch whisky exports to India by £1 billion over the next five years from over £200 million in 2022. Scotch accounts for around 2.5% of India’s whisky market.
“We are giving signals to the EU that we are open to offer concessions,” the official said.
The next round of India-EU talks is scheduled next week.
“There is not much concern on chocolates, cosmetics and even Scotch imports. We don’t expect a huge rise in their imports that could hurt our domestic industry,” said an official.
India’s imports from the UK were $7.28 billion in April-January FY25 with those of precious and semiprecious stones at $2.2 billion, nuclear reactors and boilers at $1.2 billion, medical and surgical instruments at $311 million, and beverages and spirits at $307.95 million.
“Through this deal, tariffs on soaps, shaving cream, face cream and nail polish will either be removed on day one or removed after staging over 10 years. In addition, perfumes and eau de cologne will see tariffs of 20% halved after staging, increasing the opportunity for exporters and reducing costs,” the UK said in a statement.
As soon as the FTA comes into force, 64% of tariff lines or product categories such as advanced manufacturing such as aircraft parts, and fresh and frozen salmon from the UK will be eligible for tariff-free imports into India, the UK said. After 10 years, chocolate, sweet biscuits, soft drinks and non-alcoholic beer would get tariff-free access into India.
“The FTA will encourage imports but Indian industry would continue to remain competitive in sectors such as chocolates and cosmetics,” said Bipin Sapra, tax partner, EY India.
Scotch whisky exports to India by £1 billion over the next five years from over £200 million in 2022. Scotch accounts for around 2.5% of India’s whisky market.
“We are giving signals to the EU that we are open to offer concessions,” the official said.
The next round of India-EU talks is scheduled next week.
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