India and UK Comprehensive Economic and Trade Agreement (CETA) to be enforced on 15th July | Current Affairs | Vision IAS

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In Summary

  • India-UK CETA, signed July 2025, aims to double trade to $100 billion by 2030, enhancing export competitiveness with 99% duty-free access.
  • CETA offers comprehensive services commitments, extends social security exemption for Indian workers to 5 years, and includes next-gen chapters on innovation and sustainability.
  • This agreement signifies India's rising economic diplomacy, aligning with 'Viksit Bharat 2047' and securing national interests through geoeconomic tools.

In Summary

Simultaneously, Agreement on Social Security or Double Contribution Convention (DCC) will also be enforced establishing a benchmark of India’s economic diplomacy.

About India- UK (United Kingdom) CETA

  • Background: Groundwork was laid in 2021 through adoption of India–UK Roadmap 2030, that dealt with elevating bilateral ties to Comprehensive Strategic Partnership and doubling trade to USD 100 billion by 2030.
    • CETA was officially signed in July 2025.

Key Benefits for India

  • Enhances Competitiveness for India’s exports: Secures immediate duty-free access on 99% tariff lines. 
  • Comprehensive Services Commitments: Covers all major services sectors and 137 sub-sectors of export interest to India offering greater regulatory certainty to financial services, professional services, etc. 
  • Social Security: Exempts Indian workers and employers from making dual social security contributions in UK during temporary assignments; increases period of exemption from 3 to 5 years. 
  • Next-Generation Framework: Embeds forward-looking chapters on innovation, sustainability, securing critical supply chains, accelerating technological collaboration, etc. 
  • People Centric: Benefits farmers, fisherfolk, women, entrepreneurs, startups, MSMEs, etc., with increased access to global value chains. 

India’s Rising Economic Diplomacy

  • Other Key Recent Agreements Signed: India – United States of America (USA) framework for interim Agreement; India –European Union (EU) FTA; India -New Zealand FTA; India – Oman Comprehensive Economic Partnership Agreement (CEPA); etc. 
  • Significance: Geoeconomics tool to secure National interest; fulfils shared interests with countries with geopolitical convergences, aligned with vision of "Viksit Bharat 2047,etc. 
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CEPA

Comprehensive Economic Partnership Agreement. A trade agreement aimed at significantly increasing bilateral non-oil trade between India and UAE, involving tariff reductions and increased market access.

Viksit Bharat 2047

A vision for India to become a developed nation by 2047, the 100th year of its independence. It aims at holistic development encompassing economic growth, social welfare, technological advancement, and good governance.

Geoeconomics

The study of the interplay between geography, economics, and politics. It focuses on how economic strategies and tools are used for political influence and how geopolitical factors affect economic outcomes.

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