- Planned 40% cuts to UK export support staff risk undermining
delivery of the UK–India trade deal
The Business and Trade Committee today warns that billions of
pounds of tariffs savings from the UK's trade deal with India
could be jeopardised by deep cuts to UK export support staff
responsible for helping firms use the Agreement in practice.
The report published today comes as the Government puts
the landmark UK- India Comprehensive Economic and
Trade Agreement (CETA) before Parliament for
ratification.
New analysis by the Committee shows that initial duty savings for
exporters to India could total £400 million a year, potentially
rising up to £3.2 billion after ten years as export volumes
increase.
But the Committee warns that these savings may not materialise if
the Department of Business & Trade delivers deep cuts to
support staff without a clear plan to help exporters make the
most of the new deal - and resources the work needed to drive
down India's extensive ‘non-tariff barriers'.
The CETA with India - the biggest bilateral deal since since
Brexit - could deliver:
- An increase to UK GDP of £4.8 billion every year by
2040
- Raise annual bilateral trade with India by £25.5
billion: a significant increase on the £43 billion in
2024.
- As a result, the deal is expected to increase automotive
exports by 311% and spirits exports by 180%.
- It also provides the first opening for the UK into India's
central government procurement system.
Chart showing potential savings on export duties under the
terms of the CETA, including the increased potential savings if
automotive exports increase in line with assumptions under the
quota
But in a report published today to coincide with
the start of the official scrutiny period in
Parliament, the MPs raise serious
concerns about making the deal work in
practice for British businesses and consumers. India's
sprawling administrative system and complex and evolving red tape
may make it very difficult for the potential gains to
be realised.
The Committee is urging Government to take an
active role in driving implementation of the deal: supporting
exporters, monitoring how the deal is being used, and
intervening to resolve barriers as they emerge, including
through effective trade remedies.
But with Government intending to cut almost 40% of the UK trade
staff who would help British business use the deal to increase
their exports to India, there's a big question about how the
on-paper gains will translate into growth for British businesses
and the UK economy.
Rt Hon MP, Chair of the Commons
Business and Trade Committee, said: “This is the
biggest free trade deal since Brexit with the potential to
deliver billions in tariff savings for UK exporters, boosting
growth and creating new jobs. But Parliament is being asked to
ratify a deal promising billions in tariff savings while the
Government is simultaneously cutting nearly 40 per cent of the
export staff needed to help exporters make the most of this new
bargain. That is a serious delivery risk. Ratification is only
the start of turning a promise on paper into the prize of new
profits. So Ministers must now table a clear plan backed with
real resources to make access on paper into exports in practice.”
There is also concern that the deal does not go far enough on
services or access for skilled professionals, with the Committee
“sceptical” on what will be delivered in practice. And
with no bilateral investment treaty concluded, “Ministers should
set to the work of creating an ambitious and compelling vision
for the potential of a BIT to help re-energise these
talks”.
The Committee says Government must move quickly on a timeline for
implementation, to reduce uncertainty and allow businesses
to begin to act on the terms of the deal. Ministers “must be held
accountable for ensuring that businesses are able to use the
Agreement effectively” to drive growth. Ratification should not
be treated as the conclusion of the process: the Agreement is “a
floor, not a ceiling”.
As with any trade deal, there are trade-offs and risks. The MPs
heard concerns that sectors such as textiles and
ceramics, already facing stiff competition from Indian
imports, could stand to lose out further. In March
2025 the Committee reported its
concerns that the UK Employment Rights Bill did nothing
to prevent bad actors undercutting good businesses by simply
exporting labour abuses, and recommended an update to the Modern
Slavery Act to mandate reporting on supply chains.
In the absence of binding human rights protections in
the CETA, Government must set clear and enforceable
expectations for UK business setting up supply chains with Indian
companies.
