Big news on the trade front — India and the UK are expected to sign a long-awaited free trade agreement (FTA) this Thursday during Prime Minister Narendra Modi's visit to the UK,
officials confirmed.
Under the deal:
- India will lower tariffs on British whisky, cars, and some food products.
- The UK will offer duty-free access to Indian textiles, electric vehicles (EVs), and more.
The agreement, finalized in May after three years of back-and-forth negotiations, aims to remove trade barriers and boost access to each other’s markets. However, it won’t come into effect immediately — it still needs approval from India’s federal cabinet and the UK Parliament, which is expected to happen within a year.
“This is a significant agreement,” said Foreign Secretary Vikram Misri, who added that legal review is almost done ahead of Modi’s trip, which includes stops in the UK and the Maldives.
Commerce Minister Piyush Goyal will join Modi for the formal signing ceremony. This marks Modi’s fourth UK visit since taking office in 2014, and he is set to meet with newly elected Prime Minister Keir Starmer.
Trade snapshot:
- Bilateral trade hit $55 billion in FY 2023–24.
- The UK is India’s sixth-largest investor, with investments totaling $36 billion.
- Around 1,000 Indian companies operate in the UK, employing 100,000 people and investing $20 billion.
According to the commerce ministry, 99% of Indian exports to the UK — including key products like textiles, footwear, marine, and engineering goods — will enjoy zero tariffs under the deal. On the UK side, 90% of tariff lines will see reductions.
“This FTA is a game changer,” said Ajay Sahai, head of the Federation of Indian Export Organisations. “It opens big opportunities for Indian exporters, especially in sectors like textiles, engineering, and marine products.” Photo by Fred Romero from Paris, France, Wikimedia commons.