The India-UK Comprehensive Economic and Trade Agreement (CETA), signed on July 24, 2025, marks a significant milestone in the bilateral relations between the two nations. The signing ceremony, witnessed by Prime Minister Narendra Modi and UK Prime Minister Keir Starmer, took place at Chequers, the British Prime Minister's country residence. This event, symbolically dubbed "Chai Pe Charcha," highlights the strengthened partnership and shared vision for economic growth.

The CETA is projected to double bilateral trade from the current $56 billion to $120 billion by 2030. The agreement eliminates tariffs on approximately 99% of tariff lines, covering almost 100% of the trade value. The UK will gain duty-free access for its 90% tariff lines that will cover 92% of existing merchandise imports from the country. India will also benefit from enhanced market access for its goods, particularly in labor-intensive sectors such as textiles, leather, footwear, gems and jewelry, and marine products.

For India, the CETA provides unprecedented market access, with zero-duty access on 99% of tariff lines, covering nearly 100% of the trade value. This will create new opportunities for various sectors, including textiles, marine products, leather, footwear, sports goods, toys, and gems and jewelry, as well as fast-growing sectors like engineering goods, auto components, and organic chemicals. The services sector, a key driver of India's economy, will also see significant benefits. The agreement includes ambitious commitments in IT/ITeS, financial and professional services, business consulting, education, telecom, architecture, and engineering, unlocking high-value opportunities and job creation.

The agreement also addresses the movement of professionals between the two countries. It streamlines pathways for Contractual Service Suppliers, Business Visitors, Intra-Corporate Transferees, and Independent Professionals (such as yoga instructors, chefs, and musicians), facilitating smoother talent flow and cross-border collaboration. A key breakthrough is the Double Contribution Convention (DCC), which exempts Indian workers and their employers from social security contributions in the UK for up to three years. This will significantly improve take-home pay and reduce costs for Indian companies.

While the FTA will allow greater access for British agri-food items, including beverages, India's sensitive agricultural sectors have been protected. Sectors such as dairy, apples, and edible oils have been kept in the negative list. The agreement ensures duty-free exports on nearly 95% of agricultural products and zero duty on 99% of marine exports.

Prime Minister Modi has invited his British counterpart, Keir Starmer, to visit India. The CETA is expected to especially benefit Indian youth, farmers, fishermen, and the MSME sector. The agreement is a win for farmers, ensuring duty-free exports on nearly 95% of agricultural products, while fisherfolk gain from Zero Duty on 99% of marine exports, boosting their incomes. The deal will also have a transformative impact on manufacturing-intensive sectors like engineering goods, electronics, pharma, chemicals, food processing, and plastics, providing Indian consumers with quality goods at competitive prices. India's talent in IT, services, and education will gain from easier access to the UK's high-value markets.