Prime Minister Narendra Modi celebrated the signing of the landmark India-UK Free Trade Agreement (FTA) on Thursday, marking a significant milestone in the bilateral relationship between the two nations. Speaking alongside UK Prime Minister Keir Starmer, PM Modi highlighted the enhanced market access and economic opportunities the agreement provides for both India and the UK, while also expressing gratitude for the warm hospitality he received during his official visit.
“Today marks a historic day in our bilateral relationship,” PM Modi stated. He noted the conclusion of the Comprehensive Economic and Trade Agreement after extensive efforts. The FTA, signed in the presence of PM Modi and Keir Starmer, is designed to provide greater access to goods and services between the two countries. During his two-day official visit, PM Modi emphasized that the agreement acts as a blueprint for shared prosperity.
The agreement is expected to benefit Indian sectors like textiles, footwear, gems and jewellery, seafood, engineering goods, agricultural products, and processed foods, providing better access to the UK market. In turn, the UK will see more affordable access to products such as medical devices and aerospace components within India. The aim of the trade deal is to reduce or eliminate tariffs on imports and exports, making Indian products more competitive in the UK and vice versa. The goal is to increase bilateral trade to USD 120 billion by 2030.
The FTA is projected to boost key sectors, including textiles, leather, footwear, sports goods, toys, marine products, gems and jewellery, engineering goods, auto parts, engines, and organic chemicals. The agreement ensures comprehensive market access for goods across all sectors, covering India’s export interests. India will gain from tariff elimination on approximately 99% of tariff lines, covering almost 100% of the trade value, offering huge opportunities for increased bilateral trade.
The UK government stated that India’s average tariff on UK products will decrease from 15% to 3% under the FTA. British companies, from soft drinks and cosmetics to cars and medical devices, will find it easier to sell in the Indian market. Whisky producers in the UK will benefit from tariffs slashed in half immediately, going from 150% to 75% and then to 40% over the next ten years, giving the UK an advantage in the Indian market.