Expanded Options: An Increasing Number of British Brands Enter the Market

From beauty creams to chocolates, Indian consumers are set to enjoy a wider array of British brands following a recent Free Trade Agreement (FTA) with the UK. This agreement is expected to significantly reduce tariffs on UK products, making them more affordable and enhancing competition in the Indian market. As a result, both new and existing British brands are likely to expand their presence in India, offering local shoppers more choices than ever before.
Impact of the Free Trade Agreement
The FTA between India and the UK is poised to lower the average tariff on British products from 15% to just 3%. This reduction is expected to facilitate easier market entry for UK brands, allowing them to offer their products at more competitive prices. Radhika Ghai, founder and CEO of Kindlife, an online marketplace based in Gurgaon, noted that the FTA will simplify the registration and onboarding process for British brands. She mentioned that her platform is currently in discussions with several UK cosmetic brands eager to enter the Indian market. The agreement is anticipated to attract a diverse range of British brands, from value to luxury segments, capitalizing on India’s growing consumer base.
Opportunities for Existing Brands
Several British brands, including The Body Shop, Burberry, and Asos, are already established in India. Shriti Malhotra, executive chairperson of Quest Retail, which manages The Body Shop in India, stated that 90% of their products are imported from the UK. The FTA is expected to further reduce import duties on these products, benefiting consumers directly. Currently, the Indian beauty market is valued at approximately $20 billion, with UK imports accounting for a small fraction of this figure. Experts believe that the FTA will enable existing British brands to leverage their familiarity with the Indian market to expand their offerings and reach more consumers.
Market Growth Potential
The potential for growth in the Indian market is significant, especially with the increasing number of affluent and young consumers seeking premium products. Rahul Guha, senior director at Crisil, highlighted that the current market share of UK imports is relatively small, estimated at around Rs 250-300 crore. The FTA is expected to create a more favorable environment for British brands, making it easier for them to establish online listings and franchise agreements in smaller towns. Anand Ramanathan, a partner at Deloitte South Asia, emphasized that existing British retail brands will be the primary beneficiaries of the deal, as they already have a foothold in the Indian market.
Future Collaborations and Investments
With the reduction in tariffs, British brands are likely to increase their marketing investments in India. Suresh Nair, an indirect tax partner at EY India, suggested that forming joint ventures with Indian companies could be a viable strategy for British brands moving forward. This collaboration could enhance brand visibility and accessibility in the Indian market. As the FTA unfolds, the landscape for British brands in India is set to evolve, offering consumers a broader selection of products and fostering a competitive retail environment.
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