UK-India Free Trade Agreement (FTA)

On 6 May 2025, India and the UK finalized a landmark Free Trade Agreement (FTA). Government of India has described this as “a historic and ambitious deal to boost jobs, exports, and national growth.”  The FTA includes tariff elimination on 99% of Indian tariff lines, covering nearly 100% of trade value, and reduces tariffs on 90% of UK tariff lines, with an estimated annual economic boost of £4.8 billion (US$6.4 billion) for the UK by 2040.

This alert is based on the summary information put out by the India and UK governments. Specific commitments must be verified from the formal signed documents, once available.

Key benefits (as summarized by the two sides):

• Enhanced market access might benefit products from UK like whisky, gin, automotive, medical devices, cosmetics, aerospace components, lamb, salmon, electrical machinery, soft drinks, chocolate, and biscuits. Indian sectors like textiles, marine products, leather, footwear, sports goods, toys, gems, jewelry, engineering goods, auto parts, engines, and organic chemicals stand to benefit.

• Economic growth and jobs: Bilateral trade, valued at US$60 billion (£42.6 billion) in 2024, is projected to double to US$100 billion ( £ 75 billion) by 2030, boosting national growth for both economies.

• Services and professional mobility: The agreement eases mobility for professionals, including contractual service suppliers, business visitors, investors, intra-corporate transferees, and independent professionals like yoga instructors, musicians, and chefs, offering “greater global mobility for aspirational young Indians”. This was a key demand from India.

• Consumer benefits: Commitments on digitally delivered services and streamlined customs processes enhance trade efficiency for both nations. 

• While the specifics of the agreement, i.e. the detailed tariff reduction schedules, rules of origin, quantum of the import quotas, services covered and nature of commitments thereon, etc., are awaited, stakeholders should prepare to leverage these opportunities as the agreement moves toward implementation.