After four Prime Ministers, three and a half years of negotiations and two different governments, terms for a landmark agreement has been agreed – the UK-India Free Trade Agreement (the 'FTA'). The UK Government have described the FTA as the "best deal that any country has ever agreed with India"1, as well as the "most economically significant bilateral trade deal the UK has done since leaving the EU".2
Considering the wider context of the deal, it is not difficult to see why the FTA is quite so significant. With India set to become the fourth largest economy in the world3, the FTA brings together one of the world's fastest growing economies and the highly developed economy of the UK. The projected effect of the FTA poses significant opportunities for the growth of businesses and private wealth across both jurisdictions. It is a FTA that, in spite of some of the arguable missed opportunities, we are all excited about.
What are the key takeaways from the FTA?
The FTA is expected to boost UK GDP by £4.8 billion, with bilateral trade expected to increase by £25.5 billion each and every year in the long run4. India will eliminate or reduce 90% of their UK tariff lines, thereby increasing their trade flow with the UK5 and pioneering provisions on digital trade and intellectual property have been agreed6, which will better protect businesses that are operating in, or are looking to move their operations to, India.
We see the opportunities for businesses and individuals across the UK and India to grow their wealth. The more stringent IP protections that are set to be adopted in India will increase India's attractiveness as a country to conduct business in, where you know that your business will be sufficiently protected. On the UK side, the expansion of Indian businesses into the UK will have a positive, indirect impact on the UK real estate market, both from an investment and an occupational perspective.
Why at Withers we have our finger on the pulse
Why consider the impact of the FTA now when it is unlikely to be implemented until January 2026 at the earliest? Because now is the time to start planning in order to maximise on the advantages and the growth that is envisaged from the FTA coming into force.
Our dedicated India group at Withers are collaborating with professionals in India and the UK to ensure that we are the best placed law firm to advise our clients on how they can capitalise on the opportunities that will be afforded by the FTA.
We will be examining the intricacies of the FTA in more detail and highlighting how Withers' extensive practice areas can support private individuals, families and businesses in navigating and taking full advantage of the FTA.
Footnotes
5. Ibid.
6. Ibid.
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