India UK Free Trade Agreement FTA signed on July 24, 2025 in London, UK by PM Narendra Modi and UK PM Keir Starmer.
Table of Contents
- 1 Overview & Timeline of India UK Free Trade Agreement FTA
- 2 Trade & Economic Benefits of India UK Free Trade Agreement FTA
- 3 Tariff Reductions & Market Access
- 4 Services, Mobility & Investment
- 5 Strategic & Sectoral Cooperation
- 6 Projected Economic Impact due to India UK Free Trade Agreement FTA
- 7 Future Roadmap
- 8 Summary Table
- 9 References & Sources on news related to India UK Free Trade Agreement FTA
Overview & Timeline of India UK Free Trade Agreement FTA
- Finalized in Principle: May 6, 2025
- Cabinet Approval (India): July 22, 2025
- Signing Date: July 24, 2025, in London by PM Narendra Modi and UK PM Keir Starmer
Trade & Economic Benefits of India UK Free Trade Agreement FTA
- Expected Trade Boost: $34 billion annually by 2040
- Trade Target: Doubling bilateral trade to $120 billion by 2030
Tariff Reductions & Market Access
India’s Export Benefits:
- Almost 99% of Indian goods will have zero-duty access to the UK.
- Big gains for textiles, leather, footwear, marine products, engineering goods, and gems & jewellery.
UK’s Export Benefits:
- 90% of UK tariff lines eliminated or reduced.
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Key sectors with tariff cuts:
- Scotch whisky & gin: Duties cut from 150% to 75% immediately, down to 40% over 10 years.
- Automobiles: Duties on luxury cars reduced from over 100% to 10% (under quota).
- Other sectors: Cosmetics, medical devices, electronics, food, salmon, lamb, and machinery.
Services, Mobility & Investment
- 1,800 visas for Indian professionals (chefs, yoga instructors, musicians, IT experts, etc.).
- Social security benefit: National Insurance exemption in the UK extended to 3 years (from 1 year).
- UK companies allowed to bid on non-sensitive Indian government tenders (~£38 billion).
Strategic & Sectoral Cooperation
- Electric Vehicles (EVs): UK granted quota access for Indian electric/hybrid vehicles.
- Climate & Innovation: Launched “UK–India Vision 2035” for cooperation in:
- Defence
- Green energy
- Education & innovation
- Clean technology
Projected Economic Impact due to India UK Free Trade Agreement FTA
- UK: GDP gain of £4.8 billion/year, £2.2 billion in wages, and £1.8 billion in tax revenue.
- India: Boost in export-driven sectors, FDI, and overseas remittances.
Future Roadmap
- Ratification: Pending approval from UK Parliament (expected within 6 months).
- Bilateral Investment Treaty: Still under negotiation and not part of the FTA.
- Environmental Clauses: No Carbon Border Adjustment Mechanism (CBAM) included yet.
Summary Table
| Area | Highlights |
|---|---|
| Market Access | 99% duty-free access for Indian goods; 90% for UK exports |
| Tariff Cuts | Scotch whisky, automobiles, cosmetics, machinery, EVs |
| Labour Mobility | 1,800 UK visas for Indian professionals; 3-year NI exemption |
| Procurement | UK access to Indian public procurement (~£38 bn) |
| Strategic Cooperation | Vision 2035 on defence, clean energy, innovation, education |
| Economic Gains | £4.8 bn UK GDP boost; $34 bn in projected bilateral trade |
| Ratification | Pending in UK Parliament; expected late 2025 |
Also read:
What is a Free Trade Agreement (FTA)
India’s Free Trade Agreements