The India–UK Comprehensive Economic and Trade Agreement (CETA) came into force on 15 July 2026, marking the beginning of a new phase in bilateral trade between the two countries.
The agreement was signed in London on 24 July 2025 after fourteen rounds of negotiations by India’s Commerce and Industry Minister Piyush Goyal and the UK’s Business and Trade Secretary Jonathan Reynolds, in the presence of Prime Ministers Narendra Modi and Keir Starmer. It required ratification in both India and the UK before entering into force. India’s Commerce Secretary, Rajesh Agrawal, has described CETA as a “gold standard” agreement spanning 30 chapters that extend well beyond tariff liberalisation.
As Manisha Malhotra, Vice President – Freight Forwarding, Logistics, SCO (India), DP World, puts it, “Trade agreements are often measured by the tariffs they remove. Their true success, however, is determined by the capabilities they unlock.”
What the Agreement Covers
The UK will provide duty-free access for virtually all Indian exports, while India will progressively reduce tariffs on around 90% of its tariff lines, covering roughly 92% of goods imports from the UK. Dairy, select agricultural products and high-value jewellery remain largely outside the concessions.
Some reductions are significant but phased over time. India’s duty on Scotch whisky and gin will fall from 150% to 75% immediately before declining further to 40% over the next ten years. UK-made passenger vehicles will receive tariff concessions only within an annual tariff-rate quota (TRQ), protecting India’s domestic automotive industry from a sudden surge in imports. Machinery, medical devices, aerospace components, and food and beverage products will also benefit from phased tariff reductions.
Beyond goods, CETA opens 137 services sub-sectors to Indian providers, one of the UK’s most ambitious services commitments in any trade agreement, covering IT, financial and legal services, healthcare, education, digital trade, government procurement, intellectual property and professional mobility.
“The landmark agreement is expected to significantly strengthen bilateral trade by eliminating tariffs on 99% of India’s exports, covering almost 100% of the trade value, thereby enhancing India’s export competitiveness. The agreement is also expected to expand bilateral trade, attract investment, create new opportunities for businesses, and boost bilateral trade to USD 100 billion by 2030,” Malhotra said.
Why This Deal Matters
With bilateral trade currently valued at around USD 56 billion, the agreement provides significant headroom for growth across sectors. Indian exporters in textiles, leather and footwear, gems and jewellery, engineering goods, marine products, agriculture and MSMEs are expected to be among the biggest beneficiaries of improved market access.
“The UK–India Comprehensive Economic and Trade Agreement marks an important shift in the trade relationship between two economies with complementary strengths,” Malhotra noted.
She added, “Preferential access across sectors including automotive, engineering, textiles, leather, footwear and food products has the potential to accelerate India’s integration into higher-value global value chains. But tariff concessions alone will not drive competitiveness.”
Beyond Tariffs: The Execution Challenge
While tariff reductions improve market access, exporters will realise the full benefits only if they can meet compliance requirements and move goods efficiently across borders. Success will depend on mastering several operational challenges:
- Rules of origin compliance — proving products qualify for preferential treatment through robust documentation and traceability.
- Customs efficiency — minimising border delays and administrative costs that could erode tariff advantages.
- Logistics synchronisation — aligning production schedules with multimodal transport networks to ensure timely deliveries.
- Digital visibility — using real-time shipment tracking to improve planning, manage risks and enhance supply chain resilience.
“Businesses will need supply chains that are agile, compliant, and connected. Meeting rules of origin requirements, maintaining documentation integrity, navigating customs efficiently and synchronising production with multimodal transport networks will become just as critical as manufacturing excellence itself,” Malhotra said.
For many exporters, particularly MSMEs without dedicated trade compliance teams, logistics partners will play a critical role in navigating these requirements and translating tariff preferences into tangible trade growth.
“At DP World, we are well positioned to support this next phase of UK–India trade. Our globally integrated freight forwarding network spans over 300 offices worldwide and is backed by owned multimodal assets across India and more than 80 countries. Combined with end-to-end digital visibility and strong local execution, these capabilities enable us to help customers build more resilient, agile and efficient supply chains, transforming preferential market access into reliable trade flows and long-term growth,” Malhotra said.
What Comes Next
The coming months will test how effectively businesses translate the agreement’s provisions into commercial gains. Exporters in textiles, leather, engineering goods and other key sectors will be watching how quickly they can operationalise the new tariff schedules while adapting sourcing, compliance and logistics strategies.
If implemented effectively, CETA has the potential to do far more than reduce tariffs. By improving market access, strengthening supply chains and encouraging investment, it could reshape the UK–India trade corridor into a more integrated, resilient and competitive economic partnership.
