FINWIRES · TerminalLIVE
FINWIRES

UK-India Free Trade Agreement to Take Effect from July 15

By

The Comprehensive Economic and Trade Agreement (CETA) between India and the United Kingdom, which was signed last year, will come into effect on July 15, according to official statements from both sides released on Wednesday.

Under the pact, the UK will provide zero-duty access to 99% of Indian products, while India has agreed to remove or reduce tariffs on 90% tariff lines, which will cover 92% of existing goods imports from the UK.

The deal is expected to boost the UK's gross domestic product by 4.8 billion pounds sterling, real wages by 2.2 billion pounds, and bilateral trade by 25.5 billion pounds sterling every year in the long run.

The two parties worked out the contentious issue of steel exports. India has secured protection for the majority of its steel exports to the UK under the agreement, with 85% of outbound shipments kept outside Britain's upcoming steel safeguard measures.

For Indian consumers, the deal will make whisky cheaper with tariffs cut from 150% to 40%, automobiles from 100% to 10% under a quota, and cosmetics will see tariffs of up to 22% eliminated either from day one or after 10 years.

The British government said businesses had 28 days to register in order to get the benefit of tariff reductions.

Related Articles

International

Australia Must Prepare for More Shock-Prone Financial System Amid Strained Geopolitical Climate, Central Bank Assistant Governor Jones Says

Australia must be ready to manage a financial system that is more prone to shocks, as the currently strained geopolitical environment carries broad implications ranging from the resilience of key payments infrastructure to the fragmentation of cross-border capital flows, Reserve Bank of Australia Assistant Governor Brad Jones said in a Wednesday speech.Speaking at an Australian Banking Association conference in Melbourne, Jones said some of the most consequential developments in the global financial system's modern history were the result of geopolitical unrest.Geopolitical shocks have a long history of hampering bond and stock markets by disrupting supply chains, and the associated risk has long been part of contingency planning for the payment system, which is "an issue of particular relevance today," Jones said.At the same time, the financial system also has a record of shaping geopolitical developments, he said, pointing to the role of the British bond market in halting Napoleon's march across Europe early in the 19th century.As challenges to international cohesion have resurfaced, financial and economic linkages are again being reshaped by strategic considerations, with some indicators suggesting that a fracturing is underway "on a scale and with a speed unseen in eight decades," the central bank official said."All of this brings us to the old aphorism - we must take the world as it is, not as we wish it to be," Jones said. "It is in this context that policy makers are dialing up efforts to ensure the financial system can weather a more challenging risk environment."While the composition of international asset exposures for Australian banks is somewhat less troublesome than in other countries, the high foreign ownership share of the country's fixed-income markets means "the Australian financial system will not be immune from shocks abroad," Jones said.

ASX 200
International

Australia's Leading Index Inches Up in May, Remains Weak

The six-month annualized growth rate in the Westpac-Melbourne Institute Leading Index inched up slightly to negative 0.17% in May from negative 0.18% in April, but remains weak, Westpac said in a report on Tuesday.The index indicates the expected pace of economic activity compared with trend levels three to nine months into the future.The Australian economy is experiencing a noticeable loss of momentum, as indicated by the March quarter national accounts showing a softening in activity, apart from increased investment in data centers.The May index suggests that the subdued growth will likely persist into the latter half of the year and into early 2027.

ASX 200
International

Singapore's Trade Surplus Narrows to SG$5.57 Billion in May

Singapore's merchandise trade surplus contracted to SG$5.57 billion in May from SG$13.1 billion in the prior month, according to data from Enterprise Singapore released on Wednesday.The latest figure, however, beat Trading Economics' forecast of SG$7 billion in surplus.Total merchandise exports increased 39.7% year over year, faster than the 33.0% growth recorded in the previous month.Meanwhile, total merchandise imports rose 43.6% year over year, compared with a 34.5% growth in the preceding month.

^STI