The UK and India have struck an “ambitious” trade deal that will slash tariffs on products such as whisky and gin. 

The agreement will also see Indian tariffs cut on cosmetics and medical devices and will deliver a £4.8bn boost to the UK economy, according to the government.

It is also expected to increase bilateral trade by £25.5bn, UK GDP by £4.8bn and wages by £2.2bn each year in the long term.

Politics latest: PM urged to rethink two major policies

The news will be a welcome boost for the government following poor local election results, which saw Labour lose the Runcorn by-election and control of Doncaster Council to a resurgent Reform UK.

What will also be touted as a victory for Downing Street is the fact the government managed to strike a deal with India before the White House.

Speaking to reporters on Tuesday, Sir Keir Starmer hailed the “historic day for the United Kingdom and for India”.

“This is the biggest trade deal that we, the UK, have done since we left the EU,” the prime minister said.

What trade-offs are in the ‘historic’ deal with India?

Gurpreet Narwan

Business and economics correspondent

@gurpreetnarwan

This is the most significant trade deal Britain has negotiated since Brexit. It has been three years in the making with round the clock negotiations taking place in recent days.

Britain and India were coming from very different starting points. India’s economy is notoriously protectionist, with average tariff rates floating at around 130%. The UK, by comparison, is a very open economy. Our tariff rates hover around 5%. It means there were many prizes on offer for UK exporters, who are eyeing up a rapidly growing economy with increasingly powerful consumers.

The government will point to considerable concessions on 90% of tariff lines, 85% of them will go down to zero within the decade. It includes wins on whisky, which within ten years will be halved from the current 150%. No other country has managed to get India to move on that.

Of course there are trade-offs involved. The UK has agreed to lower tariffs on Indian textiles and apparel- a big employer in India. It will also make it easier for Indian professionals to come to the UK, something the Indians have been pushing hard on. However, there will be no formal changes to immigration policy.

Both countries have also refused to budge on certain industries. The UK has not lowered tariffs on milled rice, out of fear it could decimate native industries. The same applies to dairy for the Indians. Both sides have agreed quotas on cars for the same reason.

The Indians were pushing for an exemption for its high emission industries from the UK’s upcoming carbon tax. It is understood that will not happen.

“And it’s the most ambitious trade deal that India has ever done. And this will be measured in billions of pounds into our economy and jobs across the whole of the United Kingdom.

“So it is a really important, significant day. “

In a post on X, Indian Prime Minister Narendra Modi also welcomed the agreement as a “historic milestone” and added: “I look forward to welcoming PM Starmer to India soon.”

Negotiations for the deal relaunched in March after stalling under the Tory government over issues including trade standards and the relaxation of visa rules for Indian workers.

Overall, 90% of tariff lines will be reduced under the deal, with 85% of those becoming fully tariff-free within a decade.

Whisky and gin tariffs will be halved from 150% to 75% before falling to 40% by year ten of the deal, while automotive tariffs will go from more than 100% to 10% under a quota, the Department for Business and Trade (DBT) said.

For Indian consumers, there will be reduced tariffs on cosmetics, aerospace, lamb, medical devices, salmon, electrical machinery, soft drinks, chocolate and biscuits.

Meanwhile, British shoppers could see cheaper prices and more choice on products including clothes, footwear, and food products including frozen prawns as the UK liberalises tariffs.

India’s trade ministry said that under the deal, 99% of Indian exports will benefit from zero duty, Britain will remove a tariff on textile imports and Indian employees working in the UK will be exempt from social security payments for three years.

Read more:
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Shadow trade secretary Andrew Griffith added: “It’s good to see the government recognise that reducing cost and burdens on businesses in international trade is a good thing, and that thanks to Brexit we can do.

“But it would be even better if they would apply the same reasoning to our domestic economy, where they remain intent on raising taxes, energy costs and regulatory burdens.”

The news was also welcomed by business group the British Chamber of Commerce, which said it was a “welcome lift for our exporters”.

William Bain, head of trade policy, said:  ”Against the backdrop of mounting trade uncertainty across the globe, these tariff reductions will be a big relief. Products from Scotch whisky to clothing will benefit and this will give UK companies exporting to India a clear edge on increasing sales.

“The proposals for a follow-up investment treaty will also provide a solid platform to grow manufacturing and other sectors in our two economies.”

The UK and India have struck an “ambitious” trade deal that will slash tariffs on products such as whisky and gin. 

The agreement will also see Indian tariffs cut on cosmetics and medical devices and will deliver a £4.8bn boost to the UK economy, according to the government.

It is also expected to increase bilateral trade by £25.5bn, UK GDP by £4.8bn and wages by £2.2bn each year in the long term.

Politics latest: PM urged to rethink two major policies

The news will be a welcome boost for the government following poor local election results, which saw Labour lose the Runcorn by-election and control of Doncaster Council to a resurgent Reform UK.

What will also be touted as a victory for Downing Street is the fact the government managed to strike a deal with India before the White House.

Speaking to reporters on Tuesday, Sir Keir Starmer hailed the “historic day for the United Kingdom and for India”.

“This is the biggest trade deal that we, the UK, have done since we left the EU,” the prime minister said.

What trade-offs are in the ‘historic’ deal with India?

Gurpreet Narwan

Business and economics correspondent

@gurpreetnarwan

This is the most significant trade deal Britain has negotiated since Brexit. It has been three years in the making with round the clock negotiations taking place in recent days.

Britain and India were coming from very different starting points. India’s economy is notoriously protectionist, with average tariff rates floating at around 130%. The UK, by comparison, is a very open economy. Our tariff rates hover around 5%. It means there were many prizes on offer for UK exporters, who are eyeing up a rapidly growing economy with increasingly powerful consumers.

The government will point to considerable concessions on 90% of tariff lines, 85% of them will go down to zero within the decade. It includes wins on whisky, which within ten years will be halved from the current 150%. No other country has managed to get India to move on that.

Of course there are trade-offs involved. The UK has agreed to lower tariffs on Indian textiles and apparel- a big employer in India. It will also make it easier for Indian professionals to come to the UK, something the Indians have been pushing hard on. However, there will be no formal changes to immigration policy.

Both countries have also refused to budge on certain industries. The UK has not lowered tariffs on milled rice, out of fear it could decimate native industries. The same applies to dairy for the Indians. Both sides have agreed quotas on cars for the same reason.

The Indians were pushing for an exemption for its high emission industries from the UK’s upcoming carbon tax. It is understood that will not happen.

“And it’s the most ambitious trade deal that India has ever done. And this will be measured in billions of pounds into our economy and jobs across the whole of the United Kingdom.

“So it is a really important, significant day. “

In a post on X, Indian Prime Minister Narendra Modi also welcomed the agreement as a “historic milestone” and added: “I look forward to welcoming PM Starmer to India soon.”

Negotiations for the deal relaunched in March after stalling under the Tory government over issues including trade standards and the relaxation of visa rules for Indian workers.

Overall, 90% of tariff lines will be reduced under the deal, with 85% of those becoming fully tariff-free within a decade.

Whisky and gin tariffs will be halved from 150% to 75% before falling to 40% by year ten of the deal, while automotive tariffs will go from more than 100% to 10% under a quota, the Department for Business and Trade (DBT) said.

For Indian consumers, there will be reduced tariffs on cosmetics, aerospace, lamb, medical devices, salmon, electrical machinery, soft drinks, chocolate and biscuits.

Meanwhile, British shoppers could see cheaper prices and more choice on products including clothes, footwear, and food products including frozen prawns as the UK liberalises tariffs.

India’s trade ministry said that under the deal, 99% of Indian exports will benefit from zero duty, Britain will remove a tariff on textile imports and Indian employees working in the UK will be exempt from social security payments for three years.

Read more:
Kemi Badenoch ‘confident’ she will lead Tories into next election
Welsh Labour leader backs calls for winter fuel payment cut rethink

Shadow trade secretary Andrew Griffith added: “It’s good to see the government recognise that reducing cost and burdens on businesses in international trade is a good thing, and that thanks to Brexit we can do.

“But it would be even better if they would apply the same reasoning to our domestic economy, where they remain intent on raising taxes, energy costs and regulatory burdens.”

The news was also welcomed by business group the British Chamber of Commerce, which said it was a “welcome lift for our exporters”.

William Bain, head of trade policy, said:  ”Against the backdrop of mounting trade uncertainty across the globe, these tariff reductions will be a big relief. Products from Scotch whisky to clothing will benefit and this will give UK companies exporting to India a clear edge on increasing sales.

“The proposals for a follow-up investment treaty will also provide a solid platform to grow manufacturing and other sectors in our two economies.”

“Good luck, because it’s a shithole here,” a prisoner shouts as we walk around the grounds at HMP Foston Hall.

Other inmates described this women’s prison in Derbyshire as a “holiday camp”, even “rehab”.

There was no one homogenous view, but there is also not one type of prisoner here – it is home to both murderers and shoplifters.

We’ve come to talk to people ahead of the publication of the sentencing review in the coming days. It’s likely to recommend the scrapping of short sentences for some lower-level crimes, and suggest prison isn’t the best place to punish certain “vulnerable” groups of offenders, including women.

“My kind of theft, I nick chocolate from shops,” inmate Connie Parsons told us as we gathered in her cell.

She’s been convicted of shoplifting nine times and says she’s been in and out of prison since she was 15 years old.

“I normally only get four weeks, three weeks, two weeks. It’s a constant cycle of going out, committing crime,” she said.

Ask Mollie a question about this story

At points, Parsons has been homeless and addicted to drugs.

“I used to just come to prison before to have a little lie down and get myself well… to keep myself safe,” she said. “But this prison, you’re not safe… I never self-harmed before I came to this prison. And now I self-harm quite a lot.”

She has a young teenage son on the outside. “I know this might sound harsh, but I think it’s got to the point now I don’t know what to miss about him. But I think about him every single day,” she said.

‘For lots of women, prison is the right place to be’

We put Parsons’ case to the prisons minister, Lord Timpson, who said it was “really sad to hear”, adding he sees “lots of people like Connie” in the prison system.

Pressed on how some will view Parsons as a repeat offender, perhaps deserving of prison, Lord Timpson said: “For lots of women, prison is the right place to be, but where there are certain circumstances, for example non-violent offences for women… you need to work out what is the right path to make sure they don’t commit further crime.”

Lord Timpson said for someone like Parsons, he’d like to see the use of an intensive supervision court or as he called it “problem-solving court”. These work by judges monitoring the progress of offenders on community sentences, offering “wraparound” support, including housing, help for addiction issues and mental health.

Prisoner leaves with jail on her CV

“I had a job, I ain’t got a job now,” said Tilat Ajmal.

Before she went to prison, Ajmal worked for the NHS as a cleaner for 18 years.

As we filmed, she was leaving jail after serving less than three months for smuggling an item into prison while visiting someone. It was her first offence.

Her bags were packed, and in them was a CV she’d prepared. But she didn’t seem hopeful.

“I think it’s a bit bad having a conviction, I’ve been working all my life,” she said.

“As soon as coming out of them gates, I think you just have hundreds and thousands of things going through your head.”

‘Just enough time to rip their lives apart’

After we filmed at the prison, Sky News joined a support session at a women’s centre in Nottingham. It offers mandatory services to people serving sentences in the community, and also those on probation or licence periods.

I asked a case worker to explain why certain women offenders should be considered unique in the criminal justice system.

“I think what happens when a man goes to prison is that there is usually a woman holding everything together,” said Rachel Strong.

“He will be released from prison, his home will still be there, his family. He may have lost his job but there will be someone there. He will come out to his support network in place.

“That woman is that support network – so when she goes to prison, there’s nobody holding that together. People will lose their homes, sometimes their children are taken into care.

“Usually when women are sent to prison it’s for short sentences. Not enough time for anything productive, just enough time to rip their lives apart.”

‘It’s like rehab’

“I don’t mind prison, it’s like rehab,” said Donna Pritchards, who has been to HMP Foston Hall three times.

“I know you get clean when you’re here, and I needed it.”

Drugs are ‘main issue’ in prison

Others told us it was “easy” to get hold of drugs inside jail, with one prisoner describing some leading a “life of luxury”, with jail being like a “holiday camp”.

Amanda Brewer, drug strategy lead, told us: “Illicit drugs are our main issue day to day in everything that we do.

“They’re the main drivers for violence, they can cause self-harm issues, they cause vulnerability.”

Prisoners are also “trading” prescription drugs between one another.

‘Prison is not a nice place to be’

As the government explores greater use of alternatives to custody and scrapping certain short prison sentences, I asked the prisons minister whether criminals might see their approach as a “soft touch”.

“Prison is not a nice place to be,” said Lord Timpson, “but they need to turn their lives around there.”

The government commissioned the sentencing review alongside the creation of the Women’s Justice Board because they have an overcrowding crisis across the prison estate. But they also fundamentally believe prison isn’t the best form of punishment for certain types of offenders.

Women offenders in England and Wales are likely to be disproportionately impacted by the recommendations made in the review.

That’s because we expect it to suggest the scrapping of certain short sentences. In 2022, the Prison Reform Trust found over half (58%) of terms given to women were for less than six months.

Women are also considered by ministers to be a “vulnerable” group, with prison having a knock-on impact on their lives and potential for reoffending. Many report being a victim of crimes like domestic abuse, and 55% of female prisoners are mothers.

After two days of rare and unique access to different parts of the criminal justice system, it’s clear many feel prison isn’t working for female offenders. But what exactly a greater use of alternatives to custody looks like will take some time to figure out.