India-UK Free Trade Agreement comes into effect: what changes

📌 Summary:

• The India-UK Free Trade Agreement (FTA) came into effect on July 15, 2026 — negotiated over four years, it is India's first comprehensive deal with a developed country and sets the template for India-EU talks
• India cut tariffs on ~90% of products; the UK eliminated tariffs on 99% of Indian exports
• Boost for India's labour-intensive exports: textiles, footwear (UK duty cut from up to 16%) and gems & jewellery (from up to 12%); helps India compete with Bangladesh
• Consumer gains: British car tariffs cut from up to 110% to 30% in year 1, falling to 10% by year 5 (quota starts 20,000 vehicles, peaks at 37,000); Scotch/whisky duty cut from 150% to 75%, then 40% by year 10
• First-time features: self-declaration of origin by UK exporters (replacing authority-issued certificates); phased cut of up to 14% tariffs on UK medical devices — reducing India's dependence on Chinese medical devices and ASEAN imports
• Steel: UK quotas expected to raise India's iron & steel exports from ~$850 million to over $1 billion
• Services: exemption from UK National Insurance for 5 years to benefit ~75,000 Indian professionals and ~900 firms (avoids double social-security contribution)

🎯 UPSC Relevance: GS2/GS3 — trade liberalisation, FTAs, India's integration into global value chains amid a fracturing world trade order.

📝 Prelims Facts:

• India-UK FTA effective July 15, 2026; India's first FTA with a developed economy
• UK zero tariffs on 99% of Indian exports; India cuts on ~90% of tariff lines
• Car quota: 20,000 rising to 37,000 vehicles; NI exemption for 5 years

🔑 Key Term: Self-declaration of origin — exporters/producers self-certify a good's country of origin instead of obtaining a certificate from a designated authority, cutting customs delays.