The India-UK Free Trade Agreement (FTA), signed on July 24, 2025, marks a significant milestone in the economic partnership between the two nations. This landmark deal, finalized after three years of negotiations, is expected to boost bilateral trade by $34 billion annually and potentially double it to $60 billion by 2030. The agreement aims to eliminate tariffs on a majority of goods, fostering job creation, investment flows, and streamlined regulatory approvals.

Key Highlights of the FTA

• Tariff Reductions: India will cut tariffs on 90% of UK products, while the UK will eliminate duties on 99% of Indian exports. India's average tariff on UK products will drop from 15% to 3%. The UK will eliminate import taxes on 99% of India's marine exports, including shrimp, fish meal, and feed.
• Boost to Key Sectors: The FTA is set to significantly benefit Indian sectors like textiles, apparel, leather, gems and jewellery, pharmaceuticals, marine, and engineering goods. Key sectors in the UK that could benefit include beverages, the automotive industry, advanced manufacturing, and life sciences.
• Increased Market Access: The agreement ensures comprehensive market access for Indian goods across all sectors. Indian farm products will get tariff parity with major European exporters like Germany.
• Job Creation: The FTA is expected to have a positive impact on job creation in India, particularly in labor-intensive sectors such as textiles, leather, and jewellery.
• Investment Flows: The deal could encourage greater bilateral investment flows.
• Streamlined Approvals: The FTA is expected to streamline regulatory approvals for Indian pharmaceutical products in the UK.
• Agriculture Boost: India's agriculture exports to the UK are expected to rise by over 20% in the next three years. More than 95% of Indian agricultural and processed food items will have zero duties under the deal, including fruits, vegetables, cereals, and ready-to-eat foods.

Impact on "Brand India"

The India-UK FTA is poised to significantly enhance "Brand India" on the global stage in several ways:

• Enhanced Export Competitiveness: By lowering trade barriers and simplifying procedures, the FTA is expected to enhance India's export competitiveness. Zero duties on textiles and leather are expected to boost India's competitiveness among regional peers such as Bangladesh and Cambodia.
• Increased Global Recognition: The agreement is expected to ensure comprehensive market access for Indian goods across all sectors.
• Attracting Investments: The FTA demonstrates India's willingness to lower barriers as it seeks to attract investments.
• Strategic Partnerships: The deal comes at a time when both countries are seeking reliable, diversified trade ties in a rapidly shifting global order.
• Modern, Reinvigorated Partnership: The two Prime Ministers will also unveil a “U.K.-India Vision 2035” to take their partnership to new heights in a time of rapid global change.

Concerns and Considerations

While the FTA is largely seen as a positive step, some concerns have been raised:

• Impact on Certain Sectors: India will cut car import duties from over 100% to 10%, putting its auto industry and millions of jobs at risk.
• Limited Visa Benefits: UK firms get wide access to India's services and government tenders, while India gets only limited visa benefits.
• Patent Rules: India has also agreed to new patent rules, possibly affecting access to affordable medicines.

Despite these concerns, the India-UK FTA is expected to be a transformative agreement that will significantly boost trade, investment, and job creation in both countries. It is a crucial step in strengthening the economic partnership between India and the UK and will help to elevate "Brand India" on the global stage.