New Delhi (ABC Live): FTA benefits for Indian IT companies: The India–UK FTA opens a new chapter for India’s globally competitive Information Technology (IT) and IT-enabled Services (ITES) sector. With the UK being India’s second-largest services export market after the US, the agreement brings mobility, market access, and digital harmonisation under formal trade protections. ?
New Delhi (ABC Live): FTA benefits for Indian IT companies: The India–UK FTA opens a new chapter for India’s globally competitive Information Technology (IT) and IT-enabled Services (ITES) sector. With the UK being India’s second-largest services export market after the US, the agreement brings mobility, market access, and digital harmonisation under formal trade protections.
? Key Data Highlights
| Metric | Value |
|---|---|
| India’s IT/ITES exports to the UK (2023–24) | $5.8 billion |
| Share of IT in total services exports to UK | 68% |
| Expected growth in IT services exports by 2030 | 35–50% |
| Indian tech professionals in UK (2024) | ~24,000 |
| Post-FTA permitted annually (mobility quota) | Up to 75,000 |
Source: NASSCOM, SEPC, Ministry of Commerce
? Key Benefits for the Indian IT Sector
1. Labour Mobility Provisions
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Indian IT professionals, engineers, and project managers can now work in the UK for up to 2 years without local office presence.
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Social Security Waiver: Indian workers posted to the UK don’t need to pay UK National Insurance for up to 36 months—saving ~?5–6 lakh per person per year.
Impact:
Boosts ease of short-term project deployment, especially for Indian IT companies servicing UK clients in software, ERP, cybersecurity, fintech, and consulting.
2. Recognition of Digital Trade Standards
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The FTA promotes:
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E-contracts, e-signatures, and cross-border data flows
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Dialogue on AI ethics, cybersecurity, and digital regulations
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Impact:
Enables SaaS companies, fintech startups, and AI firms to deliver cloud-based and platform services seamlessly between India and the UK, without fear of digital discrimination.
3. Access to UK Government & Institutional Tech Contracts
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Indian tech MSMEs and large IT firms can now bid for select UK public procurement contracts.
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Priority areas include:
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GovTech
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Climate tech
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Digital identity and cyber infrastructure
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Impact:
Expands market reach for Indian firms in public sector transformation and smart infrastructure domains.
4. Faster Licensing & Mutual Recognition for Technical Services
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While legal services remain restricted, Indian tech service providers—especially in architecture, engineering, and consultancy—benefit from quicker licensing and visa approval.
Impact:
Boosts access for Indian IT consultancies offering integrated design, coding, and system implementation services.
5. Boost to SME IT Service Exporters
The FTA will reduce:
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Legal entry barriers
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Double taxation risks
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Turnaround time for compliance certifications
Impact:
Small and mid-sized Indian IT firms can now serve UK SMEs and institutions more affordably—building client bases without setting up costly offices.
? Indian IT Clusters That Benefit Most
| City/Region | Focus Area | FTA Opportunity |
|---|---|---|
| Bengaluru | SaaS, fintech, AI | UK-based client acquisition & platform sales |
| Hyderabad | Pharma IT, e-health | E-health platforms & compliance advisory |
| Pune | ERP, cloud, HR tech | Offsite delivery centers for UK SMBs |
| Noida/Gurgaon | Cybersecurity, telecom | Partnering UK telcos & gov cyber programs |
| Chennai | Automotive software, IoT | Auto tech licensing via UK procurement deals |
? Strategic Action Plan for Indian IT Companies
| Step | Description |
|---|---|
| Register under SEPC | For accessing service export incentives and FTA handholding |
| Apply for UK service mobility quota | Through DGFT or direct client invitation |
| Upgrade to UK standards (GDPR, NCSC) | Ensure compliance for contracts and SaaS products |
| Partner with UK-based tech SMEs | Joint bidding for public contracts or white-label delivery |
? Final Verdict
The India–UK FTA provides Indian IT firms with a clear runway for expansion—especially in the areas of:
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Staff deployment for short-term projects
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Cross-border cloud delivery and platform hosting
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Digital regulation cooperation
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Government procurement and SME client acquisition
Indian IT firms—especially those in Tier II and III cities—must now think globally, digitally, and compliantly to capitalize on this post-FTA advantage.
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