Historic trade deal signed with India to deliver £130 million boost to the East Midlands

Businesses and workers in East Midlands are set to benefit from the UK’s trade deal with India, as new analysis shows the landmark agreement will deliver a £130 million boost for the local economy as part of the Plan for Change.

Both Prime Ministers met yesterday morning for the signing of the landmark UK-India trade deal as new analysis reveals communities across every region of the UK will benefit from its £4.8 billion increase to UK GDP each year. 

740 East Midlands businesses exported goods worth £130 million to India last year, which could grow even more under the new deal. The region’s strong high value manufacturing and automation sectors for instance could see a boost thanks to lower tariffs on advanced manufacturing goods and on importing Indian textiles. 

Business and Trade Secretary Jonathan Reynolds said: “The millions brought to the East Midlands each year from the deal we’ve signed with India will be keenly felt across local communities, whether that’s higher wages for workers, more choice for shoppers, or increased overseas sales for businesses. 

“This government is proving time and again that we can deliver on our mission to grow the economy, put more money in pockets and boost living standards under our Plan for Change.” 

Workers in the East Midlands will enjoy an uplift in pay as UK wages grow by £2.2 billion each year, and could also see cheaper prices and more choice on clothes, shoes, and food products. The UK already imports £11 billion in goods from India but liberalised tariffs on Indian goods will make it easier and cheaper to buy their best products. 

For businesses in the East Midlands, this could mean potential savings in the region’s established manufacturing sectors, including machinery, equipment and automotive components.

India’s trade weighted average tariff will drop from 15% to 3% which means companies in the East Midlands selling products such as luxury knitwear to India will find it easier to sell to the Indian market. It gives the UK an advantage over international competitors in reaching the Indian market, forecast to have over a quarter of a billion high income consumers by 2050.

Aligned with the UK’s recent Industrial and Trade Strategies, the deal will support the sectors which drive the most growth for the economy such as precision engineering and high-value manufacturing in the East Midlands. The deal will offer significant opportunities for rail manufacturing, for which the East Midlands is recognised as a globally recognised with the deal and unlocking significant opportunities for transport experts in the region. 

The East Midlands Chamber has welcomed the government’s free trade deal with India, said to be worth £4.8bn to the UK economy each year, which will cut the average tariff on UK goods to 3%.

Director of Policy and Insight Richard Blackmore said: “With the significant administrative burden and costs firms have to trawl through to trade internationally, every deal achieved in easing the burden on businesses exporting goods and services is a step forward and can only be good for economic growth, especially if it attracts inward investment too.

“Reducing reams of paperwork and associated costs is something businesses really need and while free trade deals are something I’d like to see more of, it’s also important firms are given guidance on how to use them.  The government’s recently published Trade Strategy included plans to support SMEs that export but the detail on how that might look and the extent was light.

“The Chamber’s International Trade department can advise businesses importing or exporting goods on how best to proceed.”