Businesses and workers in the West Midlands are set to benefit from the UK’s trade deal with India more than any other region in the UK, as new analysis shows the landmark agreement may deliver a £190 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.
977 West Midlands businesses exported goods worth £592 million to India last year, which could grow even more under the deal. The region’s strong automotive sector for instance could see a boost thanks to tariffs on major manufacturers like Jaguar Land Rover and Aston Martin being reduced from up to 110% to 10% under a quota.
Business and Trade Secretary Jonathan Reynolds said:
“The millions brought to the West 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.”
Richard Parker, Mayor of the West Midlands, said:
“The West Midlands has long been a gateway for trade, and our region’s deep-rooted ties with India – in business, culture and community – mean this deal will deliver real benefits on the ground.
“With nearly a thousand local firms already exporting to India, this agreement gives us a platform to grow even further – creating jobs, boosting wages and opening up new opportunities for the future.”
Workers in the West 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 West Midlands this could mean potential savings when importing automotive products and electrical goods.
India’s trade weighted average tariff will drop from 15% to 3% which means companies in the West Midlands selling machinery 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 automotives in the West Midlands. The deal will also offer significant opportunities for business and financial services in the region.
JCB Chief Executive Graeme Macdonald said:
“India is a great country in which to do business. JCB has been manufacturing machines there since 1979. So, we know India very well and the opportunity for British businesses in that huge market is significant.
“It’s the fifth largest economy in the world and is tipped to become the third largest by 2028. This Free Trade Agreement should give British businesses the confidence they need to enter the market, trade more easily and benefit from the massive opportunity.”