UK, India Sign Landmark Trade Deal After 3-Year Negotiations
The UK and India finalized a bilateral trade agreement expected to boost annual trade by £25.5 billion by 2040, BBC reported. Announced on Tuesday after three years of talks, the deal eliminates tariffs on key exports: Indian clothing/footwear (currently up to 20%) and UK-made cars (reduced from 100% to 10% under quotas).
Prime Ministers Keir Starmer and Narendra Modi hailed the pact as “mutually beneficial,” emphasizing job creation and innovation. India gains preferential access for textiles, frozen prawns, and gems, while UK aerospace, medical devices, and cosmetics exporters benefit from lowered Indian tariffs.
Controversially, the deal includes a 3-year social security exemption for transferred employees—a first for India—allowing workers to pay contributions only in their home country. Opposition critics warned of “unfair tax advantages,” though the government clarified NHS funding remains unaffected.
With India projected to become the world’s third-largest economy, the deal strengthens UK ties to a high-growth market. Business groups praised its timing amid global protectionist trends, noting India’s $1 trillion export target by 2030 creates opportunities in infrastructure and technology sectors.
Implementation begins within a year after legal reviews. The agreement marks the UK’s largest post-Brexit trade pact, covering services and procurement alongside goods.
