The India–United Kingdom Comprehensive Economic and Trade Agreement (CETA) officially came into force on 15 July 2026, marking a major step forward in economic relations between the two countries. Alongside the trade agreement, the Double Contribution Convention (DCC) also became effective, reducing social security costs for eligible Indian professionals working temporarily in the UK.
The agreement provides zero-duty market access for nearly 99% of India’s exports, covering almost the entire value of India’s goods exports to the UK. It is expected to strengthen bilateral trade in goods and services, improve investment opportunities, simplify customs procedures, and expand market access for Indian businesses across several industries.
Implementation began immediately. On the first day, more than 50 export consignments worth over USD 140 million were dispatched from ports, airports, Inland Container Depots (ICDs), Special Economic Zones (SEZs), and manufacturing facilities across India under the new preferential tariff regime. The shipments included products such as electronics, pharmaceuticals, engineering goods, gems and jewellery, and other manufactured goods.
Key Highlights
- India–UK CETA and the Double Contribution Convention came into effect on 15 July 2026.
- Nearly 99% of Indian exports now receive duty-free access to the UK market.
- Over USD 140 million worth of export consignments were shipped under the agreement on the first day.
- More than 50 consignments were flagged off from over 20 ports, airports, ICDs, SEZs, and factories across India.
- Indian professionals on temporary assignments in the UK are exempt from dual social security contributions for up to five years under the DCC.
- The agreement covers goods, services, digital trade, investment, professional mobility, and customs cooperation.
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A New Phase in India–UK Economic Relations
The India–UK CETA is one of India’s broadest free trade agreements in terms of market access and sector coverage. Besides reducing tariffs on merchandise trade, it includes commitments covering services, digital trade, telecommunications, financial services, intellectual property, customs cooperation, and professional mobility.
According to the Ministry of Commerce, the agreement creates opportunities for sectors including textiles, leather, footwear, engineering goods, marine products, chemicals, processed food, pharmaceuticals, electronics, gems and jewellery, agriculture, and IT services. Many of these industries are labour-intensive and are expected to benefit from improved export competitiveness in the UK market.
The agreement also introduces digital trade facilitation measures, self-certification for Certificates of Origin through the eCoO 2.0 platform, and simplified customs procedures designed to reduce compliance costs, particularly for micro, small, and medium enterprises (MSMEs). The first Certificates of Origin under CETA were issued digitally on the day the agreement came into force.
Stronger Trade and Investment Opportunities
India and the UK already maintain significant economic ties. During 2025–26, merchandise trade between the two countries reached USD 25.12 billion, with India’s exports valued at USD 13.44 billion and imports at USD 11.68 billion, resulting in a merchandise trade surplus of USD 1.76 billion for India. Services trade reached USD 35.44 billion in 2024, with India recording a services trade surplus of USD 7.88 billion.
Government estimates suggest the agreement could substantially increase bilateral trade over the coming years by lowering trade barriers and improving market access. According to UK estimates cited during the launch event, CETA could increase bilateral trade by more than £25 billion annually over the long term while contributing nearly £5 billion annually to both economies.
The UK is also an important investment partner for India. The UK has invested USD 35 billion in India up to September 2024, while Indian investment in the UK stood at USD 19 billion up to March 2024. Nearly 971 Indian companies operate in the UK, while 667 British companies operate in India.
Benefits for Professionals and Businesses
A significant feature of the agreement is the Double Contribution Convention (DCC). Previously, Indian professionals on short-term assignments in the UK and their employers had to contribute to the UK’s National Insurance system even though they generally could not receive corresponding benefits.
Under the DCC, Indian professionals on temporary assignments of up to 60 months are exempt from these dual social security contributions. The government estimates that the arrangement will benefit more than 75,000 Indian professionals and around 900 Indian companies, with industry estimates suggesting annual savings of over USD 600 million.
The agreement also improves professional mobility by providing commitments across 12 major service sectors and 137 sub-sectors. It includes provisions for business visitors, intra-corporate transferees, contractual service suppliers, and independent professionals. India and the UK have also agreed to pursue Mutual Recognition Agreements for professional qualifications in areas such as nursing, accountancy, and architecture.
Implementation Begins Across India
Implementation of the agreement began immediately after it entered into force. Export consignments were flagged off from major logistics hubs, including Mundra, Nhava Sheva, Chennai, Mumbai (Sahar), Kolkata, and Hyderabad, demonstrating that customs systems and Rules of Origin certification were operational from day one. More than USD 140 million worth of exports moved under the new tariff preferences on the first day itself.
The agreement is expected to particularly benefit export-oriented sectors such as textiles, engineering goods, processed foods, marine products, pharmaceuticals, and IT-enabled services, while also supporting MSMEs through lower compliance costs and easier access to one of India’s largest export markets. By combining tariff reductions with services commitments and digital trade provisions, CETA expands the scope of India–UK economic cooperation beyond traditional merchandise trade.
Source: Ministry of Commerce & Industry
