In a major development for international trade, India and the United Kingdom have signed a historic Free Trade Agreement (FTA) that is projected to increase annual bilateral trade by $34 billion.
The pact was signed by Minister for Commerce and Industry Piyush Goyal and UK Secretary of State for Business and Trade Jonathan Reynolds in the presence of Prime Minister Narendra Modi and his British counterpart Keir Starmer.
This agreement is being celebrated as the largest trade deal Britain has entered into since its departure from the European Union, marking a key moment in the country's post-Brexit trade strategy.
British Prime Minister Keir Starmer took to social media to highlight the importance of the agreement. In a post on X, he wrote: "A landmark deal with India means jobs, investment and growth here in the UK. It creates thousands of British jobs, unlocks new opportunities for businesses and puts money in the pockets of working people."
The FTA promises enhanced market access for Indian businesses in the UK through reduced tariffs and streamlined regulatory procedures. On the Indian side, the agreement is expected to open new paths for economic growth and job creation, especially benefiting the country's youth. A key feature of the deal is that 99% of Indian exports will enjoy relief from existing tariffs.
Key Indian export sectors such as textiles, leather goods, gems and jewellery, furniture, sports equipment, chemicals and machinery are poised to become more competitive in the UK due to tariff eliminations. The agreement also includes reductions on industrial and agrochemicals, plastics, and improved entry for Indian food brands into British retail markets.
British exporters are also set to benefit hugely. Tariffs on a range of UK products - including soft drinks, cosmetics, medical equipment, and automobiles - will be reduced from 15% to 3%, potentially lowering prices for Indian consumers. Additionally, Scotch whisky, gin, luxury cars, chocolates, salmon, and biscuits are among the British goods that will become more affordable in India thanks to lower duties.
This FTA is seen as a win-win deal, promoting stronger trade relations and offering economic benefits to businesses and consumers in both countries.