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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.

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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”.

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

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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.

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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.”

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Bhutan launches tourism crypto payments with Binance Pay and DK Bank

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Bhutan launches tourism crypto payments with Binance Pay and DK Bank

Bhutan launches tourism crypto payments with Binance Pay and DK Bank

Bhutan, known for investments in cryptocurrencies like Bitcoin, has launched a tourism crypto payment system in partnership with Binance Pay and DK Bank.

The system allows Bhutan travelers with Binance accounts to pay for services like tickets, hotel stays, tour guides and other products using at least 100 different crypto assets, including Bitcoin (BTC), USDC (USDC) and Binance-backed BNB (BNB).

The initiative also opens a payment gateway for businesses in Bhutan, enabling them to accept crypto payments through a QR code on a phone, according to an announcement by Binance on May 7.

“This is more than a payment solution — it’s a commitment to innovation, inclusion, and convenience,” said Damcho Rinzin, director of Bhutan’s tourism department.

Benefits for small businesses in remote areas

The partnership specifically targets small businesses in Bhutan, such as vendors and rural artisans who may never have had access to card terminals or payment infrastructure.

“Even Bhutan’s most remote businesses can now accept crypto through a phone, gaining access to international travelers with just a QR code,” the announcement said.

Bhutan launches tourism crypto payments with Binance Pay and DK Bank
Source: Binance

Binance said tourists will be able to pay for services without needing local currency or cash.

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“No need to pack your wallet — hop on a journey of innovation and inclusion with just your Binance App,” Binance said in a post on X.

“World’s first national-level crypto tourism payment system”

Binance and Bhutan’s tourism department referred to the initiative as the “world’s first national-level crypto tourism payment system.”

“Bhutan’s model is the first to offer a fully integrated, end-to-end crypto payment system at the national level,” Binance’s announcement said, adding:

“It also addresses previous limitations by offering real-time confirmations, near-zero fees, and a fully licensed local bank handling settlements on the ground.”

Binance CEO Richard Teng emphasized that the system advances crypto payments in travel and “sets a precedent for how technology can bridge cultures and economies.”

Bhutan launches tourism crypto payments with Binance Pay and DK Bank
Source: Bhutan’s tourism department

“This initiative exemplifies our commitment to innovation and our belief in a future where digital finance empowers global connectivity and enriches travel experiences,” Teng added.

Bhutan holds multiple crypto assets

Bhutan’s launch of the payments system aligns with its broader embrace of digital assets.

The country has been working to set up a strategic crypto reserve as part of a new economic hub, while the government has been reportedly mining and investing in Bitcoin since at least 2019.

According to Arkham, Bhutan’s commercial arm, Druk Holding and Investments (DHI), has added 374 Bitcoin to its stash since early January, increasing holdings to 12,062 BTC. Additionally, the entity holds modest amounts on chains like Polygon, BNB Chain and Base.

Bhutan launches tourism crypto payments with Binance Pay and DK Bank
Crypto holdings of the Royal Government of Bhutan (DHI). Source: Arkham

While Bhutan has grown increasingly friendly to crypto adoption, regulating cryptocurrencies remains a legal gray area.

In 2020, Bhutan’s central bank, the Royal Monetary Authority (RMA), issued a warning against the Pi cryptocurrency, urging the public to exercise caution when investing in any crypto asset.

“The RMA would like to remind the general public to exercise due caution in making any investment in Pi or any other cryptocurrency as the implications, risks and use cases on the economy and financial systems are still to be ascertained,” the authority wrote.

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Red Wall Labour MPs urge Sir Keir Starmer to ‘act’ over winter fuel change ‘before it’s too late’

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Red Wall Labour MPs urge Sir Keir Starmer to 'act' over winter fuel change 'before it's too late'

Red Wall Labour MPs are demanding ministers “act now before it’s too late” and reverse the unpopular cut to winter fuel payments.

A number of MPs in the Red Wall – the term used to describe Labour’s traditional heartlands in the north of England – reposted a statement on social media in which they said the leadership’s response to the local elections had “fallen on deaf ears”.

They singled out the cut to the winter fuel allowance as an issue that was raised on the doorstep and urged the government to rethink the policy, arguing that doing so “isn’t weak, it takes us to a position of strength”.

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The group, thought to number about 40 MPs, met last night following the fallout of local election results in England, which saw Labour narrowly lose the Runcorn by-election, as well as control of Doncaster Council, to Reform.

In addition, Nigel Farage’s party picked up more than 650 councillors and won control of 10 councils in Labour strongholds such as Durham.

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Although Labour narrowly held on to mayoralties in Doncaster and the West of England, it lost control of Doncaster Council – the only local authority it had control of in this set of elections – to Mr Farage’s party, which also gained its own mayors in Greater Lincolnshire and Hull and East Yorkshire.

The MPs said the poll was the “big test for the prime minister” but that the party’s voters had “told us loudly and clearly that we have not met their expectations”.

Following the results, Sir Keir Starmer said the message he was taking away from the results was that “we must deliver that change even more quickly. We must go even further.”

His response has drawn an angry reaction from some Labour MPs who believe it amounted to ignoring voters’ concerns.

One of the MPs who was present at last night’s meeting told Sky News there was “lots of anger at the government’s response to the results”.

“People acknowledged the winter fuel allowance was the main issue for us on the doorstep. There is a lack of vision from this government, and residents don’t see it.”

Another added: “Everyone was furious”.

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Elsewhere in the statement, the MPs urged the party leadership to “visit our areas, listen and rebuild the social contract between government and the people”.

“The prime minister has shown strong leadership internationally, which must now be matched at home,” the statement read.

“The demands raised by new MPs from post-industrial towns where infrastructure is poor, with years of underinvestment, must be taken off the too-difficult-to-do list. Breakaway from Treasury orthodoxy, otherwise we will never get the investment we desperately need.”

It added: “The government needs to improve its messaging by telling our story and articulating our values in the language that resonates and is heard.

“Labour cannot afford to lose the Red Wall again as it reopens the route to a future of opposition and an existential crisis. Without red wall communities, we are not the Labour Party.

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“The government has to act now before it’s too late.”

The government has also drawn criticism for the winter fuel policy from outside Westminster.

On Tuesday, Welsh First Minister Baroness Eluned Morgan called for the cuts to winter fuel allowance to be reviewed in a landmark speech.

However, Downing Street has ruled out a U-turn on means testing the winter fuel payment.

The prime minister’s official spokesman said: “The policy is set out, there will not be a change to the government’s policy.”

They added that the decision was necessary “to ensure economic stability and repair the public finances following the £22bn black hole left by the previous government”.

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Orsted pulls plug on Hornsea 4 windfarm, blaming a surge in challenges

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Orsted pulls plug on Hornsea 4 windfarm, blaming a surge in challenges

The developer of the Hornsea 4 windfarm expansion has “discontinued” the project, blaming a surge in challenges including higher costs.

Orsted made the announcement while revealing a bigger than expected rise in first quarter profits despite increased headwinds facing its offshore wind interests.

The Danish firm secured funding for both Hornsea 3 and Hornsea 4 under the government’s auction of renewable energy “contracts for difference” last year.

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The projects, when combined, would have more than doubled the size of the existing Hornsea windfarm off the East Yorkshire coast – already the world’s largest.

It had the potential to add 2,400 MW of peak capacity – enough to power 2.6 million homes.

But the company said on Wednesday that Hornsea 4 was no longer viable in its current form.

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It cited “several adverse developments relating to continued increase of supply chain costs, higher interest rates, and an increase in the risk to construct and operate Hornsea 4 on the planned timeline for a project of this scale”.

It added: “Orsted will evaluate options for future development of the Hornsea 4 project given the continuing seabed rights, grid connection agreement and Development Consent Order.”

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The existing Hornsea development is already the world’s largest by area

The decision represents a blow to the government’s green energy ambitions.

It wants to eliminate the UK’s reliance on natural gas for energy security which, it says, will erase the country’s exposure to price volatility, bring down bills and bolster the fight against climate change at the same time.

Orsted boss Rasmus Errboe said: “We remain fully committed to being an important partner to the UK government to help them achieve their ambitious target for offshore wind build-out and appreciate the work they’ve done to deliver a clear framework to support offshore wind.

“However, our capital allocation is based on a strict and value-focused approach, and after careful consideration, we’ve decided to discontinue the development of the Hornsea 4 project in its current form, well ahead of the planned Final Investment Decision later this year.”

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A Department for Energy Security and Net Zero spokesperson responded: “We recognise the effect that globally high inflation and supply chain constraints are having on industry across Europe, and we will work with Orsted to get Hornsea 4 back on track.

“We have a strong pipeline of projects to deliver clean power by 2030 and our mission-led approach ensures we can steer our way through global pressures and individual commercial decisions to reach our targets.

“Through our mission we will deliver an energy system that brings energy bills down for good and bolsters Britain’s energy security as part of our Plan for Change.”

Dhara Vyas, the chief executive of industry body Energy UK, responded: “In 2024, wind overtook gas as GB’s largest source of power. Along with the broad range of technologies we have, wind has already and will continue to play a significant role in reducing our reliance on foreign fossil fuels, and building a resilient energy system powered predominately by British sources.

“Not only will this boost energy security, it will grow our economy and bring down bills in the long-term.

“The loss of such a big project will raise the stakes yet further for the forthcoming Contracts for Difference auction round, AR7.

“Whilst Orsted has been clear this is not a result of government policy, with offshore wind playing such a critical role in our future energy ambitions it’s vital that the government doubles down to ensure AR7 is a success.”

Greenpeace UK’s head of climate, Mel Evans, said: “It is a tragic irony that gas-driven inflation is threatening the very thing that promises to bring down the soaring cost of energy, which has sent inflation and manufacturing costs through the roof. Getting off volatile and expensive gas and making renewables the backbone of our energy system has never been more necessary than it is right now.

“Post-COVID supply chain breakdowns have also made everything much harder to build, on time or on budget.

“This is why the government must double down on its commitment to clean power and invest heavily in domestic wind manufacturing. This would help to overcome the supply chain issues faced by companies like Orsted and lower costs, which would be good for the government’s clean power plan, good for jobs and good for Britain.”

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