Daijiworld Media Network – New Delhi

New Delhi, Jul 12: The India-UK Comprehensive Economic and Trade Agreement (CETA) is expected to improve market access for Indian exporters, but tariff reductions alone will not be enough to unlock its full export potential, according to the Global Trade Research Initiative (GTRI).

The free trade agreement, which comes into force on July 15, is expected to lower tariffs on a wide range of products. However, GTRI said Indian businesses must also strengthen quality standards, certification systems, logistics and buyer networks to fully benefit from the pact.

"Without parallel work on standards, certification, logistics, regulatory approvals and buyer networks, much of the opportunity will remain on paper. The agreement opens the door; India must now convert access into exports," GTRI Founder Ajay Srivastava said.

The think tank noted that export competitiveness will vary across sectors. Food exporters will need to comply with the UK's stringent food safety, testing and traceability requirements, while engineering and electronics manufacturers must secure internationally recognised certifications and build stronger commercial partnerships.

Automobile exporters will have to meet rules of origin and technical standards, whereas manufacturers of garments, textiles, leather and footwear should move quickly to capitalise on the tariff advantages before competitors catch up.

According to GTRI, the greatest opportunities lie in sectors where India already has a strong manufacturing base, the UK has significant import demand and the trade agreement removes existing tariff disadvantages.

Srivastava said labour-intensive sectors such as garments, textiles, leather products, footwear, processed food, seafood and selected agricultural products are likely to benefit the most from the agreement.

The report pointed out that although the UK imported goods worth USD 928.9 billion in 2025, imports from India accounted for only USD 15.2 billion, representing a market share of just 1.6 per cent. The UK also accounted for only 3.4 per cent of India's global merchandise exports.

However, GTRI cautioned that a low market share alone does not necessarily indicate untapped export potential.

The think tank identified processed food as a sector with significant growth prospects. The UK imported processed food worth USD 33.4 billion last year, while India's exports to the market stood at only USD 354 million, giving it a market share of just 1.1 per cent.

It said products such as ready-to-eat foods, bakery and confectionery items, sauces and ethnic foods could see strong demand, provided exporters meet the UK's food safety, labelling and traceability standards.

While the agreement is also expected to improve opportunities for automobiles and auto components, GTRI said compliance with rules of origin and technical regulations will be crucial.

At the same time, it noted that sectors such as chemicals, pharmaceuticals, steel and alcoholic beverages may see limited gains, as regulatory approvals, safeguard measures, quality standards, procurement systems and global competition remain key challenges beyond tariff concessions.