Britain-India trade deal signed with applause, apprehension

Britain and India officially signed a free trade agreement on Thursday during Indian Prime Minister Narendra Modi's visit to Britain at Chequers, the country house of the British prime minister, following the initial announcement made in May.

The British government said that India's average tariff on British products will decrease from 15 percent to 3 percent. Under the terms of the agreement, tariffs on whisky and gin exported to India will be halved from 150 percent to 75 percent, with a further reduction to 40 percent over a decade. Meanwhile, British automotive tariffs will decrease from over 100 percent to 10 percent, subject to a quota.

In return, 99 percent of Indian exports to Britain will face zero tariff.

According to the British government's statement, the agreement will create over 2,200 jobs across Britain and will stimulate sectors including aerospace, technology and advanced manufacturing.

"Thanks to the deal, British workers will enjoy a collective uplift in wages of 2.2 billion British pounds (2.98 billion U.S. dollars) each year and could also see cheaper prices and more choice on clothes, shoes and food products," the government said in a press release.

According to the British government, the deal is expected to "increase bilateral trade by nearly 39 percent in the long run, equivalent to 25.5 billion British pounds a year, when compared to 2040 projected levels of trade in the absence of an agreement."

British Prime Minister Keir Starmer regarded the agreement as a booster to British economy. "We're putting more money in the pockets of hardworking Brits and helping families with the cost of living, and we're determined to go further and faster to grow the economy and raise living standards across the UK," he said,

"This agreement marks a great moment for both Scotch and Scotland," said Nik Jhangiani, Interim Chief Executive of British alcoholic beverage company Diageo.

However, dissents and unwelcoming voices exist. While the British government held firm on key matters like expanded visa access and post-study work opportunities, India managed to gain limited concessions for professionals. The British government on Wednesday said that they would agree on "a limited collective quota, 1,800 per year, for Indian chefs de cuisine, yoga teachers and classical musicians."

British think tank Chatham House cautioned against a narrow bilateral approach. It calls for deeper regional engagement across South Asia and the wider Indo-Pacific region.

According to British newspaper The Guardian, the two governments still have disagreements as they continue to discuss Britain's plans for a carbon border tax, which India strongly opposes.

British products such as lamb, salmon, soft drinks, medical devices and electrical machinery will be dumped into the Indian market without any restrictions by slashing Indian tariffs, said Ashok Dhawale, president of All India Kisan Sabha, the largest peasant organisation in India.

"This will act against the interest of farmers, fish workers and micro, small and medium enterprises that are engaged in food processing. In the past, all such free trade agreements, both bilateral and multilateral, have failed the Indian farmers and small industries," he said.

"It should also withdraw from negotiations with the United States for a similar treaty that would pander to the Trump-led imperialist regime," Dhawale added.

The agreement "has a message for Trump," India's The Economic Times said in a similar tone. "Unlike the Trump administration's tariff-driven approach with India, the India-UK deal, finalized after three years, demonstrates that prioritizing mutual respect and long-term strategic interests leads to more durable and beneficial agreements."