India's Chemical Export Surge: A Boost from UK Trade Deal

India's chemical exports to the UK are expected to grow significantly due to duty concessions in a new free trade agreement. This deal, starting next year, facilitates 99% duty-free access for Indian products in the UK, potentially doubling trade by 2030 by lowering tariffs on UK goods.

India's chemical export sector is poised for significant growth due to duty concessions provided by the newly signed free trade agreement (FTA) with the UK. This strategic deal, formalized on Thursday, allows 99 per cent of Indian exports to enter the UK completely duty-free starting next year. In return, tariffs on prominent British exports, including cars and whisky, will see reductions.

The agreement, struck just days before the end of a US tariff moratorium, aims to double the current USD 56 billion trade volume between the world's fifth and sixth largest economies by 2030. While India gains broader market access for its chemicals, textiles, and other goods, it will see increased availability of UK consumer products such as chocolates, biscuits, and cosmetics on its shores.

This development is particularly significant for India's chemical sector, as previous duties on chemical products of up to 8 per cent will now fall to zero. The FTA is expected to boost India's chemical exports to the UK by 30-40 per cent, with projections estimating exports could rise to USD 650-750 million in fiscal year 2025-26.

(With inputs from agencies.)