Summary:
- India and the UK signed a comprehensive Free Trade Agreement on July 24, 2025 during Prime Minister Narendra Modi‘s visit to London.
- The deal is the UK’s most significant bilateral trade agreement since Brexit, projected to boost bilateral trade to nearly $120 billion by 2030.
- Tariffs on whisky from 150% to 75%, automotive duties from up to 110% to 10%, and elimination of tariffs on aerospace and electronics.
- Indian workers and employers in the UK will be exempt from social security contributions for three years, saving approximately £342 million annually.
- The UK gains access to India’s public procurement market of £38 billion, especially in renewable energy. UK financial firms will receive commitments for fair treatment in India’s insurance sector.
- The agreement launched the ‘UK-India Vision 2035, focusing on cooperation in defense, climate change, education, and border security.
On July 24, 2025, history was made as India and the United Kingdom officially signed a comprehensive Free Trade Agreement (FTA), a landmark event occurring during Narendra Modi‘s visit to London. The deal stands out as the most significant bilateral trade arrangement for the UK since Brexit, promising to reshape economic relations and forge new pathways for commerce and cooperation between the two nations.
Background:
Here is how this event developed over time:
- July 24, 2025: The India-UK relations see a major milestone with the signing of the FTA during Narendra Modi‘s visit to London.
- Negotiations led by Piyush Goyal and Jonathan Reynolds.
- The agreement aims to eliminate tariffs on 99% of UK exports and reduce tariffs on 90% of Indian products, including duty cuts on whisky (from 150% to 75%, then down to 40%), automotive, and aerospace goods.
- The trade boost is projected to reach $120 billion by 2030 and increase UK exports to India by nearly 60% by 2040, adding approximately £4.8 billion annually.
- Sector-specific benefits include market access for UK automotive and services sectors in India, along with reduced social security contributions for Indian professionals working in the UK, saving an estimated £341.7 million annually.
- The public procurement market of around £38 billion annually, especially in renewable energy.
- Both nations launched UK-India Vision 2035 to deepen cooperation in defense, climate change, education, and border security.