India-UK FTA Boosts Engineering Exports

New Delhi, Jul 24 (PTI) The duty on engineering goods has been slashed from 18 per cent to zero in the Free Trade Agreement between India and the UK, a move that will make exports more competitive.

With the elimination of tariffs under the FTA signed on Thursday, engineering exports to the UK could nearly double in the next five years, reaching over USD 7.5 billion by 2029-30, a commerce ministry official said.

The UK is India's sixth-largest engineering exports market, and trade with the UK saw a strong 11.7 per cent growth in 2024-25 compared to the preceding year.


The engineering goods sector has the highest share among the listed sectors with 1,659 tariff lines, making up 17 per cent of the total.

India's global engineering exports are USD 77.79 billion, while the UK imports USD 193.52 billion worth of such products, yet only USD 4.28 billion comes from India, signalling strong potential for expansion.

Export of key engineering products like electric machinery, auto parts, industrial equipment, and construction machinery is projected to grow at a compound annual growth rate of 12-20 per cent.

The FTA between both nations offer a transformative opportunity for business across sectors such as engineering goods, the official said, adding that by opening access to the UK's import market, the FTA reduces compliance costs and time-to-market, enhancing competitiveness for Indian exporters.