The United Kingdom and India signed a historic free trade agreement (FTA), boosting bilateral trade by around $34 billion annually. The FTA, signed during Prime Minister Narendra Modi’s visit to the UK, includes tariff cuts, improved mobility for professionals, and market access guarantees that together mark one of India’s most comprehensive trade pacts.

The FTA offers duty-free access to the UK’s $23 billion market, giving Indian MSMEs a strong advantage over other countries in labour-intensive sectors such as gems and jewellery, leather and footwear, textiles. India’s gems and jewellery exports to the UK are currently valued at $941 million, with jewellery alone accounting for $400 million. With the UK importing $3 billion worth of jewellery annually, India’s exports are expected to double in 2–3 years.

The deal took three years to reach and also commits to a new India-UK plan to tackle illegal migration.Opponents had warned the deal could undercut British workers due to extended social security terms, but UK Business Secretary Jonathan Reynolds said this was “completely wrong” and Indian workers on temporary secondment to the UK would get the same deal already offered to many other countries.

The trade deal is expected to ensure comprehensive market access for Indian goods across all sectors and India will gain from tariff elimination on about 99 per cent of tariff lines (product categories) covering almost 100 per cent of the trade values, the officials said.

After signing the landmark deal, the two prime ministers are also expected to unveil an “UK-India Vision 2035” to take their partnership to new heights in a time of rapid global change.

The UK said Indian consumers will benefit from improved access to the best British products — from soft drinks and cosmetics to cars and medical devices — as average tariffs will drop from 15 per cent to 3 per cent after the FTA kicks in.