India–UK Trade Pact Unlocks Access To UK Public Procurement Market Worth USD 122 Bn: Commerce Secy

New Delhi, July 26 (KNN) The India–UK Comprehensive Economic and Trade Agreement (CETA) is set to unlock significant opportunities in public procurement, providing Indian companies access to a non-discriminatory market worth USD 122 billion in the United Kingdom, according to Commerce Secretary Sunil Barthwal.

Addressing the media on Friday, Barthwal noted that the UK has, for the first time, made a binding commitment to treat Indian suppliers on equal footing under its ‘social value’ procurement regime. 

This framework requires public bodies in the UK to consider the broader social, economic, and environmental impact of procurement decisions—beyond cost alone.

In return, India’s commitments under CETA will open up an estimated USD 114 billion public procurement market to UK suppliers. 

The agreement is only the second of its kind that India has signed containing a dedicated chapter on government procurement, following the UAE agreement in 2022. 

Officials emphasised that, unlike the UAE deal, the India–UK pact offers more balanced and meaningful market access for both sides.

While some experts have raised concerns about the scope of access provided to UK businesses—arguing it goes beyond what was offered to UAE firms—government sources stressed that key domestic safeguards remain in place. 

Notably, India has retained its procurement thresholds, below which foreign bidders remain excluded. 

For goods and services, the Indian threshold has been set at Rs 5.5 crore, compared to Rs 1.6 crore for the UK. In the case of construction services, both countries have agreed to a threshold of Rs 60 crore.

In contrast, the India–UAE Comprehensive Economic Partnership Agreement (CEPA) restricts procurement access to a limited number of central government entities and sets a much higher threshold of around Rs 250 crore across sectors. 

The UAE has also preserved several preferential policies, including those favoring local value addition and green products, without offering reciprocal guarantees to Indian suppliers.

Under the India–UK CETA, India has also secured a complete exemption for its preferential procurement policy for Micro, Small and Medium Enterprises (MSMEs). 

UK suppliers can participate as ‘Class-II local suppliers’ if at least 20 percent of the product or service originates from the UK, while Indian suppliers with more than 50 percent domestic content will continue to enjoy ‘Class-I’ status and associated preferences.

(KNN Bureau)