UK-India: A New Chapter in Global Trade
- GMCCTradeteam
- Jul 28
- 2 min read
The United Kingdom and India have officially concluded negotiations on a historic Free Trade Agreement (FTA), signed on 24 July 2025. This marks one of the most comprehensive trade agreements for both nations, aiming to deepen economic ties and open significant new opportunities across sectors.
Key Economic Gains
The deal is expected to increase the UK's GDP by £4.8 billion annually and boost wages by £2.2 billion in the long term. India’s GDP is projected to rise by £5.1 billion per year. Bilateral trade could grow by up to £25.5 billion annually compared to a scenario without the agreement.
Market Access for Goods and Services
Indian exporters will benefit from the elimination of tariffs on approximately 99% of exports to the UK, including sectors such as textiles, leather, footwear, auto parts, and jewellery. UK businesses will see reduced tariffs on over 90% of exports to India, with notable gains in whisky, gin, machinery, and processed food products.
Services and Mobility
The agreement includes provisions for smoother movement of professionals, with 1,800 new UK visas allocated to Indian service suppliers annually. Intra-company transferees will be exempt from UK National Insurance for up to three years. The deal also strengthens cooperation in digital trade, professional qualifications, and intellectual property.
Strategic and Regulatory Provisions
UK firms will gain access to India’s public procurement market, worth an estimated £38 billion per year. Customs procedures will be simplified, and both countries will benefit from improved regulatory alignment.
Challenges and Criticism
While the deal offers wide-ranging benefits, certain sectors have expressed concern. UK car manufacturers, for instance, cite slow tariff reductions and quotas for electric vehicles. Critics also note that some areas, such as pharmaceuticals and sensitive services, remain tightly controlled.
Conclusion
As the UK’s most significant post-Brexit trade agreement to date, the UK-India FTA sets a new standard for future trade policy. Once ratified by both parliaments, the deal is expected to enhance competitiveness, strengthen bilateral ties, and foster long-term economic growth.
Source: GOV
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