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New Delhi: The India-UK free trade agreement (FTA) is set to improve the market access and enhance the bilateral trade by around $34 billion annually, said the British Government on Thursday, 24th July 2025, ahead of formalising the trade deal.
The trade agreement is billed as the watershed bilateral trade agreement for the United Kingdom after leaving the European Union. The agreement is to be signed in the presence of Prime Minister Narendra Modi and his British counterpart, Keir Starmer
After BREXIT, Britain was aiming for a comprehensive trade agreement with India. The negotiations started in January 2022 after Brexit, symbolizing the U.K.’s independent trade ambitions. The trade talks got delayed due to frequent political leadership disruptions in the U.K. After a series of 14 rounds of talks and negotiations, the agreement was finalised in May 2025.
The new partnership is set to be accompanied by the unveiling of "UK-India Vision 2035," which is expected to take the bilateral relations to new heights in the face of rapid geopolitical and geoeconomic shifts.
Consumers in India would benefit from the improved access to British products ranging from soft drinks and cosmetics to cars and medical devices, as the average tariff is set to get reduced from the current 15 percent to 3 percent as proposed in the trade deal, said the British government.
Indian exports to the UK are around $15 billion worth of goods. After the trade deal, it is expected that more Indian goods and services are set to get an enhanced reach to the British consumers, said the UK government in the statement.
"Our landmark trade deal with India is a major win for Britain," Starmer said. The UK government said the FTA is expected to boost bilateral trade by 25.5 billion pounds ($34 billion) yearly.
"It will create thousands of British jobs across the UK, unlock new opportunities for businesses,drive growth in every corner of the country, delivering on our Plan for Change," he said.
The new vision for 2035 is a commitment that will go beyond trade. The common vision will take the bilateral relation to drive prosperity and enhance innovation in both countries, and a defense industrial roadmap will set the new highs in the bilateral relation.
The bilateral trade between India and the UK is $21.34 billion in FY24. Indian exports to the UK increased by 12.6% to reach $14.5 billion in FY25.
