India and UK Signs Historic Multi-Billion Dollar Free Trade Agreement
India and the UK have signed a historic Free Trade Agreement (FTA) expected to boost annual trade by $34 billion and aims to double trade to $100 billion by 2030.
India and the United Kingdom signed a major Free Trade Agreement (FTA) today (July 24, 2025) in London, marking a big step in strengthening their economic ties. The deal was signed by Indian Prime Minister Narendra Modi and UK Prime Minister Keir Starmer at Chequers, and is expected to increase trade between the two nations by $34 billion every year. This is the UK's...
India and the United Kingdom signed a major Free Trade Agreement (FTA) today (July 24, 2025) in London, marking a big step in strengthening their economic ties.
The deal was signed by Indian Prime Minister Narendra Modi and UK Prime Minister Keir Starmer at Chequers, and is expected to increase trade between the two nations by $34 billion every year. This is the UK's biggest trade deal since leaving the European Union and India's first FTA outside Asia.
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The agreement will make trade easier by cutting tariffs, or taxes, on goods. India will lower tariffs on 90% of UK products, reducing the average tax from 15% to 3%. The UK will remove taxes on 99% of Indian exports, helping Indian businesses sell products like textiles, medicines, and farm goods more easily.
For example, taxes on Scotch whisky will drop from 150% to 75%, and electric vehicle taxes will fall from 110% to 10%. Indian farmers will benefit as fruits, vegetables, spices, and processed foods like mango pulp and pickles will face no taxes in the UK.
The deal will also create jobs and opportunities. The UK expects £6 billion in new investments and over 2,200 jobs. Indian small businesses can now bid for UK government contracts, and 75,000 Indian workers in the UK will be exempt from social security payments for three years. Professionals like yoga instructors and chefs will find it easier to work in the UK, boosting India’s service sector.
Specific sectors will see big gains. Indian textiles, leather, and medicines will become cheaper in the UK, while UK products like cars and cosmetics will cost less in India. The agreement also includes rules to protect new technologies and intellectual property without hurting India’s generic drug industry.
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Both leaders called the FTA a "new chapter" for India-UK ties. The deal needs approval from India’s cabinet and the UK Parliament to take effect. A separate investment treaty is also being discussed to deepen cooperation. This agreement sets the stage for trade to double to $100 billion by 2030, benefiting both nations.
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