The comprehensive free trade agreement signed by the UK and India aims to provide the UK’s service sector with ‘market certainty’ moving forward, as well as providing significant reductions on tariffs on many UK-made goods.

According to government estimates, the agreement will boost UK exports to India by £15.7bn and GDP by $4.8bn each year by 2040.

The agreement will see tariffs cut on medical devices, cosmetics and alcoholic beverages, such as whiskey and gin – with tariffs falling from 150% to 40% over the 10 year-deal.

The government also expects to see positive impacts for those providing professional services, predicting a 7% reduction in non-tariff measures over the lifetime of the deal.

ICAEW’s Chief Executive, Alan Vallance, welcomed the announcement as a “much needed boost for business confidence in trading overseas, particularly amid a picture of global uncertainty”.

He said: “This package of deals signals an exciting new era of relations between the UK and India. It is a highly significant deal, which welcomes a new chapter of mutually-productive and prosperous deeper trade and business engagement between two very close-knit countries.

“Professional services, a vital sector in supporting the delivery of a successful Industrial Strategy, are already supporting talent and skills development between the UK and the Indian professional bodies, and we hope this FTA opens the door to greater opportunities for the institutional partnerships essential for success. We look forward to further details on this, and stand ready to work with our counterparts.”

The final text of the agreement is yet to be published and discussions are continuing on the details, including a potential 'double contribution convention’ which could exempt Indian employees from National Insurance Contributions for three years while working in the UK.

ICAEW will provide more analysis of the details of the deal and its implications for practitioners in due course.