MPs warn UK-India trade deal tariff gains at risk from cuts to export support staff

"Billions of pounds in potential tariff savings from the UK's landmark trade deal with India could be put at risk unless the Government rethinks plans to cut export support staff, MPs have warned, raising concerns that British businesses may struggle to turn the agreement into real-world growth. In a report published on Wednesday, the Business and Trade Committee said deep reductions to trade support roles within government could undermine the effectiveness of the UK-India Comprehensive Economic and Trade Agreement (CETA), despite its status as the largest bilateral trade deal struck since Brexit."

"The warning comes as ministers place the agreement before Parliament for ratification, triggering the formal scrutiny period. New analysis by the committee estimates that initial tariff savings for UK exporters to India could total around £400 million a year, rising to as much as £3.2 billion annually within a decade as export volumes increase. MPs cautioned, however, that these gains may never materialise if businesses are left without adequate support to navigate India's complex administrative system and extensive non-tariff barriers."

"Under the agreement, the Government expects the deal to lift UK GDP by £4.8 billion a year by 2040 and increase annual bilateral trade with India by £25.5 billion, a significant uplift on the £43 billion recorded in 2024. Automotive exports are forecast to rise sharply, while spirits producers are also expected to benefit from major tariff reductions. The agreement also marks the UK's first entry into India's central government procurement market."

Deep reductions to trade support roles within government could undermine the effectiveness of the UK-India Comprehensive Economic and Trade Agreement (CETA) and place billions in tariff savings at risk unless export support staff are retained. Initial tariff savings for UK exporters to India are estimated at around £400 million a year, potentially rising to £3.2 billion annually within a decade as export volumes increase. The agreement is expected to lift UK GDP by £4.8 billion by 2040 and increase annual bilateral trade with India to £25.5 billion. Practical challenges and non-tariff barriers in India may limit benefits for small and medium-sized exporters, prompting calls for the Department for Business and Trade to take a more active implementation, monitoring, and support role.

Read at Business Matters