New chapter in UK-India relations as trade deal signed
The UK-India trade deal represents a significant milestone in our economic partnership, delivering unprecedented opportunities for businesses and working people across both nations.
Current trade between our countries is worth £42.6 billion. The trade deal, which is forecast to boost bilateral trade by £25.5 billion yearly, is both India’s most comprehensive deal ever, and the UK’s most economically significant bilateral trade deal since leaving the EU.
This deal delivers on our government's economic growth mission, supporting our commitment to achieving the highest sustained growth in the G7 and raising living standards in every part of the UKopens bit.ly in a new tab. This deal will help future-proof our economies, and enhance supply chain resilience, supporting thousands of jobs across both nations.
It significantly improves market access for businesses in both countries, leading to cheaper products and services for consumers. It redefines the UK-India relationship for the next generation, unlocking trade and investment, supporting jobs, and delivering shared prosperity.
Read the press releaseopens www.gov.uk in a new tab
In the presence of Indian Prime Minister Shri Narendra Modi and UK Prime Minister Sir Keir Starmer, the landmark UK-India trade deal was signed by Commerce and Industry Minister, Mr. Piyush Goyal and Secretary of State for Business and Trade, Mr. Jonathan Reynolds in the UK (24 July 2025)
Image credit: 24 July 2025 - WPA Pool/Getty Images
Key benefits of the UK-India trade deal
Slashes tariffs and reduces trade barriers
This deal either eliminates or significantly reduces tariffs on the majority of goods between the UK and India. Lower tariffs will help cut costs for both UK and Indian businesses.
For India, lower tariffs will cut costs and support jobs in sectors such as textiles and agri-food. Duties will be cut on high-quality UK products such as Scotch whisky, Scottish salmon, and on other products including on automotives (reducing over 100% to 10% under a quota), as well as on aircraft, engines, and parts (a staged reduction from 7.5%).
Many high-end optical products, such as lenses and microscopes (currently 11%), will also have tariffs completely removed. These reductions will help Indian businesses and consumers access the high-quality goods and innovative products upon which the UK prides itself.
Paves the way for financial and digital growth
One of the landmark features of this agreement is its pioneering standalone financial services chapter – a significant first for India that locks in long-term market access worth £13.6 billion for UK financial services. This provides crucial legal certainty and equal treatment for financial institutions from both nations, including insurers and fintech companies.
Indian firms can now expand their UK operations with enhanced confidence, while British expertise and capital can more readily support India's dynamic financial ecosystem. India’s IT and digital services economy continues to expand at pace. The digital chapter, which will promote digital and paperless trade, will make trade between the UK and India even easier and boost India’s ability to export its leading digital services to the UK.
Greater opportunities for professionals
The new business mobility commitments agreed in the trade deal will enable specialists from both nations to seamlessly deliver their expertise whether in financial services, education, information technology or yoga instruction.
The UK exported approximately £1.2 billion of business services to India in 2023 and this deal can help boost our services exports to India further. Under this agreement, UK businesses will get equal treatment as domestic firms in India.
These negotiated access arrangements provide businesses with the certainty needed for long-term planning and investment, strengthening the trading relationship between the 2 countries and unlocking opportunities for learning and mutual economic growth.
Easier for UK small and medium-sized enterprise (SMEs) to export
Trading with India will become simpler. India has agreed to process goods more quickly after they arrive at customs. This will be achieved by introducing new timeframes for the release of goods, and by publishing customs procedures and laws in English and online.
It will also support electronic contracts and transactions through new digital agreements. Equally, this deal will reduce trade barriers further to give India’s SMEs greater access to the UK’s market.
This trade deal will unlock economic growth across regions and nations of the UK.
Click on the following links to read the benefits of each region.
You can find more information by viewing the UK-India trade deal: conclusion summary on GOV.UKopens www.gov.uk in a new tab.
Sources
Prime Minister's Office: Kickstarting Economic Growthopens www.gov.uk in a new tab
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