India-UK trade agreement: Exemption on Basmati and fruit export, no exemption on dairy and edible oil import
By yash chouhan 2025-07-24 16:04:06
India-UK FTA: Basmati, fruits, cotton exports exempted from tariff; no relaxation on import of dairy, apples and edible oils.
Farmers and food-processing units are set to benefit from the India-UK free trade agreement (FTA) as basmati rice, cotton, groundnut, fruits, vegetables, onion, pickles, spices, tea and coffee, etc, would be exempt from duty when exported to the UK.
Also, the FTA allows no tariff concessions on import of dairy products, apples, oats and edible oils. It means apple-growers in Himachal Pradesh and Jammu and Kashmir stand protected. Farmers and politicians from both states had been vocal in seeking ‘no exemption’ on apple imports.
Agriculture and food processing will have a 14.8 per cent and 10.6 per cent share, respectively, of the agreed products under the FTA, that is scheduled to be signed in London on Thursday.
A duty-free access, streamlined trade protocol, and protection for India's agriculture is part of the FTA and it sets the stage for growth in agri exports and value-added products. It unlocks premium UK markets for Indian farm and food-processing units as tariffs would match, or be lower in some cases, with benefits enjoyed by exporters from Germany, the Netherlands, and other EU nations.
Agriculture and food processing
Over 95% of ‘tariff lines’ agreed upon in the FTA will attract zero duty on Indian agricultural and processed food. India has calculated that this duty-free access is expected to increase agri exports by over 20% in the next three years, contributing to the goal of $100 billion agri exports by 2030 and putting more money in the hands of rural households.
In the food-processing sector, India exports $14.07 billion worth of goods globally, while the UK imports $50.68 billion of goods. So far, Indian products make up just $309.5 million of UK imports.
In agriculture, India exports $36.63 billion globally, while the UK imports $37.52 billion, but the UK’s imports from India are just $811 million.
India can outcompete major global players in crucial segments. For example, in processed food preparations, India would have to gain ground over the US, China and Thailand. In bakery items, Indian produce would be more competitive than those from the US, China, Thailand and Vietnam. In case of preserved vegetables, fruits, nuts, fresh vegetables and Indian produce would get a lower tariff than that applied to Pakistan, Turkiye, the US, Brazil, Thailand and China.
