India-U.K. FTA: A timely boost amid global trade turbulence

In the times where trade’s getting trickier and tariffs are the new trend, India just signed its 16th trade agreement—this time with the U.K. It couldn’t have come at a better moment. As we try to hold steady in a shifting global landscape, this deal gives our exporters and professionals something to cheer about.

Here’s what’s in it and why it matters

A welcome win for exporters

99 per cent of Indian exports (which includes key sectors like textiles, gems and jewellery, footwear, engineering goods and many more) will now enter the U.K. market duty free.¹

Takeaway

This opens up a high-value market and gives us a good counterweight to tariff challenges from the U.S. that we are potentially facing.

U.K. goods just got cheaper

India will slash tariffs on 90 per cent of U.K. imports—medical devices, electric machinery, consumer products and more to become cheaper.²

Takeaway

Indian consumers will potentially enjoy a greater variety of goods, boosting market competition and strengthening trade relations. Additionally, India’s manufacturing sector could benefit from more affordable imported input goods.

Green light for Indian talent

The deal enhances talent mobility, allowing Indian professionals—especially in IT, healthcare and finance—greater ease in working in the U.K.

Takeaway

More global exposure and mobility for our skilled workforce.

A three-year exemption on social security deductions

Indian employees working in the U.K. won’t have to pay into two systems.

Takeaway

This means more savings and less friction for businesses and employees.

The bigger picture

The two sides are now aiming to double bilateral trade to USD100 billion by 2030.³

Takeaway

As India aims to reach USD2 trillion in overall exports by 2030, this deal can provide a boost to our export engine and overall economic growth, keeping us aligned to our set targets.⁴

Bottom line

While global trade grows more complicated, this creates room for India’s economy to grow, compete and lead.

^[1] A historic and ambitious deal to boost jobs, exports and national growth, PIB, 6 May 2025, accessed on 13 May 2025
^[2] The U.K. and India just signed a 'historic' free trade deal. Here's what to know, World Economic Forum, 9 May 2025, accessed on 13 May 2025
^[3] Industry hails India-U.K. FTA as a catalyst for exports, investment, Economic Diplomacy Division, 8 May 2025, accessed on 13 May 2025
^[4] India will achieve 2 trillion export target by 2030, PIB, 16 October 2022, accessed on 13 May 2025