The UK and India have announced a trade deal this week and whilst we don't have all the details yet, here’s what our International team think you should know:

India Greater Manchester Relationships:

Greater Manchester has a well-established relationship with India. The award-winning Manchester India Partnership (MIP) was established in February 2018 to unite private businesses, academia and the public sector across India and Greater Manchester to build and strengthen trade, investment, cultural, and educational ties.

This means that Greater Manchester is in a great position to make the most of the new trade deal.

In 2022, India was the 10th largest market for Greater Manchester exports, with a total of £573m exported. 

Greater Manchester exports to India made up 2.6% of total exports, compared with a UK total 2.4%.

41% of GM exports to India were goods, whilst 59% were services. But with the reduction in tariffs over the next 10 years, expect to see an increase in goods traded. 

India as an export destination:

The UK and India have long, historical links which means there are similarities in law and trading systems. This means it’s easier to trade with that many first think. 

In general, India is a more open market with fewer non-tariff barriers than markets like China. As part of the deal, import processes will be streamlined and improved.

High growth sectors identified include: 

Advanced Manufacturing: Tariffs cut on the UK’s large and varied advanced manufacturing sectors from aerospace and automotive, electrical circuits and conductors, and high-end optical products. 

Green Technology: The clean energy industry will have brand new, unprecedented access to India’s vast procurement market as the country makes the switch to renewable energy and continues to see growing energy demand. 

Health and Life Sciences: Reduced tariffs on medical devices that take the UK’s complex supply chains into consideration will unleash new opportunities for the UK life sciences sector. 
Creative Industries: Enhanced copyright protections for the creative sector will give exporters confidence thanks to a commitment that their work will continue to be protected for at least 60 years. 

Services Sector: World-class UK services sectors – who export just over £500 billion worldwide will now benefit from market certainty when trading into the growing Indian market. 

Football: With Greater Manchester as a global destination for football, it’s also interesting to note that The Premier League which will be opening an office in Mumbai was also mentioned as a beneficiary in the trade announcement.

Opportunities for Greater Manchester Businesses:

The major update for businesses is a reduction in tariffs, something that India hasn’t previously agreed to for other trade deals. 90% of UK product lines exported to India will see tariff reductions, with 85% of those becoming fully tariff-free within a decade.

Automotive tariffs will go from over 100% to 10% under a quota. Other goods with reduced tariffs include cosmetics, aerospace, lamb, medical devices, salmon, electrical machinery, soft drinks, chocolate and biscuits. 

Whilst we’re not sure of all the specifics, any reduction in tariffs make exporting goods to India more competitive and attractive. 

One thing we do know is that whisky and gin tariffs will be halved from 150% to 75% immediately, then reduced further to 40% by year ten of the agreement. India is an important market for both these two categories, being the world’s largest consumer of Whisky and a booming market for alcohol in general. Liquor, particularly gin production in Greater Manchester is well established, and this new trade deal could open up a huge market for these products.

Lower tariffs on Indian made goods coming into the UK, such as clothing and footwear will also make it easier for Greater Manchester businesses to secure lower costs on goods imported from India. 

How to make the most of the trade deal:

It’s important to note that the trade deal could take up to a year to come into force, but businesses hoping to make the most of it should start to plan now. 

Overall, closer economic links with a country of over a billion people is good and exciting, especially given that India is expected to become the world’s third largest economy in a few years.

Want to know more about what opportunities might be available for you in India? Get in touch with our International Growth team today - International Growth | GM Business Growth Hub