Historic Free-Trade Agreement Signed Between India and the UK: Massive Boost to Jobs, Exports, and Growth
New Delhi, May 6, 2025 – In a landmark development hailed as a transformative step for India’s economy, Prime Minister Narendra Modi and UK Prime Minister Sir Keir Starmer have announced the successful conclusion of the India–UK Free Trade Agreement (FTA). The deal is set to dramatically boost employment, exports, and strategic ties while aligning with India’s vision of Viksit Bharat 2047.
This ambitious and comprehensive FTA eliminates duties on 99% of Indian exports to the UK, unlocking massive opportunities across key labour-intensive sectors including textiles, marine products, leather, footwear, sports goods, toys, gems and jewellery. It also opens significant avenues for engineering goods, auto parts, engines, and organic chemicals, positioning Indian manufacturers for stronger global competitiveness.
The agreement further delivers a powerful thrust to the services sector, with unprecedented access to the UK market for Indian companies in IT/ITeS, financial services, professional services, business services, and education. Talented and skilled Indian youth will now find enhanced mobility options for working in the UK, particularly in digitally delivered and high-value professional services.
A major win for Indian service providers is the three-year exemption from social security contributions in the UK under the newly signed Double Contribution Convention. This exemption will provide significant financial relief to Indian professionals and their employers, making Indian services more competitive in the UK and opening up new employment opportunities.
Prime Minister Modi took to social media to call the FTA a “historic milestone” that will deepen the India–UK Comprehensive Strategic Partnership and fuel innovation, trade, and job creation across both nations.
Commerce and Industry Minister Shri Piyush Goyal credited the Prime Minister’s visionary leadership for enabling the deal, describing India today as “Vishwa Mitra – Trusted Partner of the World.” Goyal emphasized that the agreement protects India’s core interests while opening global value chain integration for Indian businesses, MSMEs, startups, and innovators.
The FTA was finalised after intense negotiations that resumed following the Prime Ministers’ meeting at the G-20 Summit in Rio de Janeiro in November 2024. Commerce Minister Goyal and UK Secretary of State Jonathan Reynolds played key roles in bridging differences and shaping the agreement.
The USD 60 billion bilateral trade between India and the UK is now poised to double by 2030, with the FTA acting as a catalyst for sustainable and inclusive growth. The deal includes modern provisions on trade liberalisation, good regulatory practices, transparency, and the removal of non-tariff barriers – all designed to make doing business smoother for both sides.
Commerce Secretary Shri Sunil Barthwal called the agreement a game changer and India’s most comprehensive FTA ever, setting the gold standard for future global trade pacts.
In addition to trade in goods and services, the FTA ensures smoother entry and work rights for various categories of Indian professionals — including business visitors, investors, independent professionals like chefs, musicians, and yoga instructors, as well as dependent family members of intra-corporate transferees.
As two democratic and innovation-driven nations, India and the UK have reaffirmed their shared vision of deeper cooperation to tackle global challenges through trade, economic development, and strategic alignment.
The India–UK FTA is not just a trade deal; it is a forward-looking economic alliance that promises prosperity, progress, and partnership on a global scale.
