India and the United Kingdom have officially concluded negotiations on a comprehensive Free Trade Agreement (FTA), marking a significant milestone in bilateral economic relations. The announcement was jointly made on Monday by Indian Prime Minister Narendra Modi and UK Prime Minister Sir Keir Starmer, who held a telephonic conversation to acknowledge the successful finalization of the deal.
A statement released by the Government of India confirmed the development, noting that the two leaders also welcomed the conclusion of the Double Contribution Convention, a supplementary accord aimed at easing cross-border financial cooperation.
“The two leaders welcomed the successful conclusion of an ambitious and mutually beneficial India–UK Free Trade Agreement along with the Double Contribution Convention,” the statement read.
Prime Minister Modi, in a social media post, described the agreement as a “historic milestone” that will deepen the India–UK Comprehensive Strategic Partnership. “Delighted to speak with my friend PM Keir Starmer. In a historic milestone, India and the UK have successfully concluded an ambitious and mutually beneficial Free Trade Agreement, along with a Double Contribution Convention. These landmark agreements will catalyse trade, investment, growth, job creation, and innovation in both our economies,” he posted on X (formerly Twitter).
Modi also extended a formal invitation to Prime Minister Starmer to visit India in the near future.
Reacting to the development, Prime Minister Starmer emphasised the UK’s commitment to global economic engagement. “Strengthening alliances and reducing trade barriers with economies around the world is part of our Plan for Change to deliver a stronger and more secure economy,” he said.
Bilateral trade between India and the UK stood at USD 21.34 billion in 2023–24, reflecting an increase from USD 20.36 billion the previous year. Presently, Indian goods entering the UK are subject to an average tariff of 4.2 per cent—a burden the new FTA aims to ease significantly.
According to the Global Trade Research Initiative (GTRI), Indian exporters are expected to benefit across several sectors, including textiles, garments (shirts, trousers, dresses), bed linen, footwear, carpets, automobiles, marine products, grapes, and mangoes. These products currently face low to moderate import duties in the UK market.
Free Trade Agreements typically involve either the elimination or substantial reduction of tariffs on a wide range of goods, alongside provisions that simplify trade in services and encourage bilateral investments. The Indian side has pushed for greater access for skilled professionals—particularly in the IT and healthcare sectors—while also seeking zero-duty access for key goods.
The United Kingdom, in turn, has sought significant tariff reductions on products such as Scotch whisky, electric vehicles, lamb meat, chocolates, and select confectionery items. Additionally, the UK is looking to expand opportunities for its service sector within India, particularly in telecommunications, legal, banking, and insurance services.
The agreement comprises 26 chapters, covering a broad spectrum of issues including goods, services, investments, and intellectual property rights, reflecting the depth and ambition of this strategic trade pact.
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