Landmark pact removes tariffs on most Indian exports and strengthens bilateral trade, investment and services cooperation
The India-United Kingdom Free Trade Agreement (FTA) officially came into force on 15 July, marking a significant milestone in bilateral economic relations and paving the way for stronger trade, investment and professional mobility between the two countries.
Under the agreement, the UK has eliminated tariffs on almost all Indian exports, providing duty-free access to around 99 per cent of tariff lines by value. The move is expected to benefit a wide range of sectors, including textiles, apparel, leather goods, gems and jewellery, engineering products, marine products, food processing and chemicals.
Indian exporters are expected to become more competitive in the British market as the removal of import duties lowers costs and improves market access. Small and medium-sized enterprises are also expected to gain from simplified trade rules and greater export opportunities. Officials estimate that engineering exports alone could see substantial growth over the coming years.
The agreement also delivers benefits for the UK, with India reducing or gradually phasing out tariffs on a broad range of British products. British businesses are expected to gain improved access in sectors such as automobiles, financial services, education, insurance and premium consumer goods.
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Beyond goods, the pact expands cooperation in services and government procurement while introducing measures to support the temporary movement of professionals
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It also includes provisions under the accompanying social security agreement that reduce double social security contributions for eligible short-term workers, a move welcomed by businesses operating across both countries
Prime Minister Narendra Modi described the agreement as a “significant moment” in India-UK relations, saying it would create fresh opportunities for businesses, workers and farmers. British officials have likewise hailed the deal as a new chapter in the strategic partnership, with both governments aiming to substantially increase bilateral trade over the coming years.
