India’s free trade agreement with the UK may improve market access for exporters, but tariff cuts alone will not be enough to unlock its full export potential, according to the Global Trade Research Initiative (GTRI). The think tank stressed that India must strengthen quality standards, certification systems, logistics and buyer networks to make the most of the pact.The India-UK Comprehensive Economic and Trade Agreement (CETA), which comes into force on July 15, is expected to reduce tariffs on a range of products. However, GTRI said the benefits will materialise only if Indian businesses are equipped to meet the UK’s regulatory and quality requirements.“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.It further said that export competitiveness will differ across sectors. Food exporters, for instance, will have to comply with stringent UK food safety, testing and traceability norms, while engineering and electronics manufacturers need globally accepted certifications and stronger commercial partnerships. Automobile exporters will have to meet rules of origin and technical standards, and apparel, leather and footwear manufacturers should move quickly to leverage the tariff advantage before competitors adapt.According to GTRI, the biggest opportunities lie in sectors where India already has a strong manufacturing base, the UK has substantial import demand and CETA removes a meaningful tariff disadvantage.“The biggest gains are likely where three conditions come together: India has strong export capacity, the UK has substantial demand and CETA removes a meaningful tariff disadvantage. That points most clearly to garments, textiles, leather, footwear, processed foods, seafood and selected farm products,” Srivastava said.The report noted that Britain’s imports touched $928.9 billion in 2025, but goods sourced from India were worth only $15.2 billion, giving India a market share of just 1.6%. The UK also accounted for only 3.4% of India’s global merchandise exports.However, Srivastava cautioned against assuming that a low market share automatically translates into export potential.“Export potential depends on four factors – UK demand, India’s export capacity, its current UK market presence and the tariff advantage created by CETA. Standards, food-safety rules, safeguards, certification and supply-chain constraints can matter as much as tariffs,” he said.GTRI identified labour-intensive sectors such as garments, textiles, leather products, footwear, processed food and seafood as among the strongest beneficiaries of the agreement. It also sees opportunities in automobiles, motorcycles, auto components and selected engineering products.The think tank highlighted processed food as an area with significant untapped potential. While the UK imported processed food worth $33.4 billion last year, India supplied only $354 million, leaving its market share at just 1.1%.“Large UK demand, low Indian penetration and tariff cuts create strong potential in ready-to-eat foods, bakery and confectionery products, sauces and ethnic foods. Food safety, labelling and traceability will remain critical,” the report said.While CETA could also improve prospects for automobiles and auto components, GTRI said compliance with rules of origin and technical regulations will determine the extent of the gains.At the same time, it cautioned that tariff concessions alone may not significantly benefit sectors such as chemicals and pharmaceuticals, where regulatory approvals, quality standards and procurement systems play a bigger role in market access.The think tank also flagged challenges for steel exports, noting that the UK’s safeguard measures, lower import quotas and high above-quota tariffs could offset the benefits of the trade agreement. Similarly, India’s alcohol exports are unlikely to see substantial gains because of limited export scale, weak global branding and intense international competition, it added.
