PM Modi in London: Historic India–UK Free Trade Agreement Set to Transform Bilateral Relations
London, 24 July 2025 – Indian Prime Minister Narendra Modi is on a two-day state visit to London, featuring the formal signing of a landmark India–UK Free Trade Agreement (FTA). This pact is expected to significantly reshape economic ties between India and the UK under the umbrella of a Comprehensive Strategic Partnership.

Key Highlights & Tariff Reductions
-
Tariff cuts:
-
UK duties on Indian exports slashed—99% duty-free, including textiles, footwear, gems & jewellery, auto components, electrical machinery, furniture, and more.
-
India will reduce or eliminate tariffs on 90% of UK goods—notably halving Scotch whisky duties from 150% to 75% immediately, with further reductions to 40% over 10 years; automobile tariffs drop to 10% under quota systems.
-
-
Economic boost:
-
The agreement is projected to double bilateral trade to $120 billion by 2030, and increase cumulative trade by £25.5 billion by 2040.
-
UK GDP is expected to rise by £4.8 billion annually.
-
Services, Mobility & Procurement Gains
-
Professionals & Social Security:
-
Indian professionals (ITC, chefs, yoga instructors, etc.) gain enhanced mobility and a 3‑year waiver on UK National Insurance contributions, potentially saving ₹4,000 crore (~US $463 million).
-
-
Public procurement:
-
UK companies can bid for Indian government contracts over ₹2 billion (≈£38 billion annually)
-
Diplomatic & Strategic Context
-
High-level meetings:
-
PM Modi is scheduled to meet UK PM Keir Starmer at Chequers, followed by a royal audience with King Charles III.
-
-
Strategic agenda:
-
Talks will encompass trade, health, education, defence, technology, and climate across the Comprehensive Strategic Partnership framework.
-
-
Next steps:
-
The deal, signed by Modi and Starmer, is awaiting ratification by the British Parliament and India’s cabinet, expected to be completed within approximately a year.
-
Sectoral Winners & Strategic Outlook
-
Booster for Indian exporters:
-
Sectors such as textiles, leather, pharma, engineering goods, marine products, and gems & jewellery will receive major boosts.
-
Companies like Welspun, Arvind, Bata, Relaxo, Tata Motors, and Bharat Forge stand to gain direct market access.
-
-
UK advantages:
-
Scotch whisky, UK-made cars (e.g., Jaguar Land Rover, Aston Martin), cosmetics, medical devices, and salmon will benefit from tariff relief.
-
-
Critiques:
-
Chatham House has called for a broader Indo‑Pacific strategy, suggesting the FTA alone isn’t “transformative".
-
Comments (0)