NEW DELHI: In a historic step towards strengthening bilateral economic ties, Prime Minister Narendra Modi and UK Prime Minister Sir Keir Starmer on Tuesday announced the successful conclusion of the long-anticipated India–UK Free Trade Agreement (FTA). Described as one of the most comprehensive trade deals ever entered into by India, the agreement marks a major leap in advancing the country’s vision of Viksit Bharat 2047 and propels both nations toward deeper economic integration.The agreement follows high-level deliberations between the two leaders on the sidelines of the G-20 Summit in Rio de Janeiro in November 2024, and months of focused negotiations beginning in February 2025, led by Commerce Minister Piyush Goyal and UK Secretary of State Jonathan Reynolds.
In a post on X, Prime Minister Modi hailed the agreement as a “historic milestone,” stating, “These landmark agreements will further deepen our Comprehensive Strategic Partnership and catalyse trade, investment, growth, job creation, and innovation in both our economies.”
A New Gold Standard in Global Trade
The India–UK FTA, coupled with a unique Double Contribution Convention, reflects a shared commitment to equitable, sustainable, and inclusive growth. It covers a wide range of sectors, including goods, services, digital trade, and mobility of professionals.
Commerce and Industry Minister Piyush Goyal praised the Prime Minister’s leadership, calling the deal a “benchmark for ambitious and fair trade between two large economies.” He emphasized its wide-ranging benefits for Indian farmers, MSMEs, startups, professionals, and workers, while protecting core domestic interests.
Commerce Secretary Sunil Barthwal described the deal as a “game-changer,” highlighting its comprehensive scope and its potential to become the gold standard for India’s future trade engagements.
Key Highlights of the India–UK FTA
Tariff elimination on 99% of tariff lines, covering nearly 100% of trade value, benefiting key Indian exports such as textiles, marine products, engineering goods, auto parts, chemicals, leather, footwear, and gems and jewellery.
Significant commitments in the services sector, especially in IT/ITeS, professional services, financial services, and education, making this one of the most ambitious service sector FTAs signed by the UK.
Improved mobility for Indian professionals, including contractual service suppliers, business visitors, intra-corporate transferees, and independent professionals like yoga instructors, musicians, and chefs.
A first-of-its-kind social security exemption for Indian workers temporarily in the UK, under the Double Contribution Convention, allowing them and their employers to avoid paying UK social security contributions for up to three years, enhancing competitiveness and reducing financial burdens.
Addressing non-tariff barriers and ensuring regulatory transparency to promote ease of doing business.
Strong provisions on digital trade and professional services, opening access for Indian service providers in fields such as architecture, engineering, computer services, and telecommunications.
FTA expected to double bilateral trade, currently valued at USD 60 billion, by 2030, and significantly boost employment and investment.
A Shared Commitment to Global Growth
As two vibrant democracies and global innovation leaders, India and the UK reaffirmed their commitment to economic collaboration and shared global responsibilities. The FTA positions both nations to play a transformative role in reshaping global trade norms and building resilient supply chains.
The agreement is not just about tariffs and trade—it represents a broader commitment to people, prosperity, and partnership. It reflects India’s emergence as a “Vishwa Mitra” – a Trusted Global Partner, and a future-ready economic powerhouse integrated into global value chains.
