UK and India Sign Free Trade Agreement in Presence of PMs Starmer and Modi After Prolonged Talks

UK and India Sign Free Trade Agreement in Presence of PMs Starmer and Modi After Prolonged Talks

[London, July 24, 2025] — After years of anticipation, India and the United Kingdom have finally signed a landmark Free Trade Agreement (FTA). The agreement was formalized on Thursday in London in the presence of Indian Prime Minister Narendra Modi and his British counterpart, Keir Starmer. Both leaders hailed the deal as "historic" and expressed optimism that it would significantly deepen economic cooperation between the two nations.

The FTA is expected to boost annual bilateral trade by approximately $34 billion.

Under the agreement, 99% of Indian exports will benefit from either reduced tariffs or complete tariff elimination. At the same time, it will make it easier for British products—such as whisky, automobiles, and other goods—to access the Indian market. Finalized after three years of negotiations, the deal will provide India with extensive market access across nearly all sectors. India will receive tariff concessions on 99% of tariff lines, covering nearly 100% of its total trade.

As a result of the agreement, the average tariff on Indian goods is expected to fall from 15% to just 3%, offering a significant advantage to Indian exporters.

Prime Minister Narendra Modi stated:

“This agreement is not merely a trade deal—it is a roadmap for the future of both nations. It will benefit India's youth, farmers, fishers, and MSMEs. It opens up major opportunities for Indian products like gems and jewelry, seafood, textiles, leather, and agricultural goods in the UK market.”

British Prime Minister Keir Starmer added:

“This is the most important FTA for the UK in the post-Brexit era. It will bring tremendous benefits to businesses, jobs, and consumers. Wages will rise, living standards will improve, and trade will become easier.”

Key benefits for Indian businesses include:

• Leather and Footwear Exports: Expected to exceed $900 million

• Duty-Free Access to the $23 billion UK market

• Special Advantages for India’s labor-intensive sectors: apparel, furniture, sporting goods

• Support for MSME sector in digital and e-commerce transformation

• GI Protection to ensure international recognition for India’s traditional products

This FTA is set to make Indian exports more competitive and expand access to global markets. It will also open new opportunities for industries like seafood, agriculture, electronics, pharmaceuticals, engineering goods, and chemicals.

Analysts believe this agreement will significantly strengthen the economic partnership between the two countries and mark a major victory for India’s “Make in India” initiative.