India-U.K. Comprehensive Economic and Trade Agreement (CETA)
GS PAPER II & III — International Relations & Economy
Why in News?
The India-U.K. Comprehensive Economic and Trade Agreement (CETA) remains a key bilateral trade topic for Prelims, testing understanding of what a CETA covers and how it differs from deeper integration models like a customs union.
Key Facts for Prelims
- CETA is a broad-based Free Trade Agreement between India and the United Kingdom covering trade, investment, services, and economic cooperation.
- Aims to reduce or eliminate tariffs, improve market access, facilitate investment, and strengthen supply chains.
- Covers cooperation in digital trade, intellectual property, innovation, and government procurement.
- Improves market access for services including IT, financial, legal, and professional services.
- Expected to expand Indian exports in textiles, gems and jewellery, engineering goods, pharmaceuticals, and agricultural products.
- Enhances mobility and access opportunities for Indian professionals in the UK.
- Deepens the India-UK Comprehensive Strategic Partnership and supports supply chain diversification.
- As a Free Trade Agreement, it does not create a customs union — each country retains its own independent external tariff policy toward non-member countries.
UPSC Note — Prelims Angle
A classic distractor is confusing an FTA/CETA with a customs union — remember member countries keep independent external tariffs under an FTA.
Link CETA to the broader India-UK Comprehensive Strategic Partnership for context in both Prelims and interview-style questions.
| Prelims MCQ Practice With reference to the India-U.K. Comprehensive Economic and Trade Agreement (CETA), consider the following statements: 1. It aims to reduce trade barriers and improve market access for goods and services between India and the United Kingdom. 2. It includes provisions relating to investment, digital trade, and intellectual property cooperation. 3. It is a customs union requiring India and the U.K. to adopt a common external tariff. Which of the statements given above is/are correct? (a) 1 and 2 only (b) 2 and 3 only (c) 1 and 3 only (d) 1, 2 and 3 Answer: (a) Statements 1 and 2 are correct. Statement 3 is incorrect — CETA is a Free Trade Agreement, not a customs union, so India and the UK each retain their own external tariff policies toward non-member countries. |
