Ahead of India-UK FTA rollout on July 15, specialty chemicals industry seeks clarity on rules of origin

The India-UK Free Trade Agreement (FTA), scheduled to take intoeffect on July 15, is expected to improve market access for India’s $220 billion specialty chemicals industry by reducing trade barriers and encouraging technology partnerships and advanced manufacturing. Industry officials, however, said regulatory harmonisation, rules of origin, and technical standards will be crucial to ensure businesses fully benefit from the agreement.

According to the government data, India’s chemical exports to the UK rose from $454.27 million in FY24 to $570.32 million in FY25, accounting for nearly 2% of the country’s total chemical exports.

Under the India-UK Comprehensive Economic and Trade Agreement (CETA), Indian exporters will gain zero-duty access to more than 1,000 chemical tariff lines, a move expected to improve the sector’s competitiveness in the UK market.


According to Gopal Agrawal, CEO of chemical manufacturer Anupam Rasayan India, one of the biggest opportunities for the specialty chemicals industry is improved market access through reduced trade barriers, which would boost the competitiveness of Indian manufacturers in the UK market.

“This is particularly relevant as global customers continue to diversify their supply chains and seek reliable, innovation-driven partners,” Agrawal said, adding that the agreement could also deepen collaboration in research, technology, and advanced manufacturing.

“The UK has a strong innovation ecosystem, while India has built robust capabilities in process chemistry and cost-efficient manufacturing. The FTA can facilitate greater cross-border partnerships, joint development initiatives, and investments in next-generation chemistries, creating long-term value for both countries,” he said.

The agreement, he said, is expected to strengthen access to critical intermediates, specialty materials, and even active pharmaceutical ingredients (APIs), with the potential to enhance collaboration in contract development and manufacturing, clinical research, and innovation.

The long-term success of the agreement, however, would depend on its effective implementation, he said.

“Greater visibility on regulatory harmonisation, product standards, rules of origin, and customs procedures will be essential to ensure that businesses can fully leverage the benefits of the FTA without procedural bottlenecks,” he said.

Echoing similar views, Maulik Patel, Chairman and Managing Director of Ahmedabad-based integrated chemicals company Epigral Ltd, said tariff reductions on Indian chemical exports would improve the price competitiveness of domestic manufacturers in the UK market, where they have historically operated at a duty disadvantage.

He highlighted that easier access to UK technology, capital, and collaboration in specialty and performance chemicals could help the sector move up the value chain towards more diversified, innovation-led manufacturing. Patel said the agreement strengthens the broader case for India as a chemicals manufacturing hub by encouraging greater interest from global partners looking to source from or co-invest in the country. The pact, he emphasised, will create a more competitive and conducive environment for capacity expansion and backward integration initiatives that companies like Epigral have been pursuing across the CPVC, epichlorohydrin and chlorotoluenes value chains.

“That said, there are areas where the industry would benefit from greater clarity as implementation begins. Rules of origin requirements, particularly for products involving multi-stage processing or imported intermediates, need to be spelt out clearly so exporters can claim preferential benefits without disputes at the port,” Patel said.

Industry estimates suggest India’s chemical exports to the UK could grow by 30-40% over the next two years and cross $1 billion by 2027 following the implementation of the trade pact.

Independent trade expert Manasvi Srivastava said preferential trade agreements have become increasingly important as countries negotiate bilateral arrangements to secure better market access amid a weakening multilateral trading system. According to him, the India-UK trade agreement will benefit several Indian export sectors, including chemicals, by improving market access and creating a more level playing field in areas where Indian exporters previously faced tariff disadvantages. At the same time, the UK is expected to gain improved access for premium consumer goods in the Indian market.

Srivastava, however, highlighted that the implementation would remain critical to the agreement’s success. Greater focus on technical barriers, such as certifications, standards, Quality Control Orders (QCOs), and mutual recognition agreements, would help ensure the market access promised under the pact translates into actual trade gains. He added that greater clarity on rules of origin and their implementation would also improve predictability for businesses and strengthen confidence in the agreement.