🇮🇳🇬🇧 India–UK Sign Landmark Free Trade Agreement, PM Modi Calls It “Historic” for Bilateral Ties

On July 24, 2025, Prime Ministers Narendra Modi and Keir Starmer formally inked a landmark Comprehensive Economic and Trade Agreement (CETA) at Chequers in the UK—a treaty hailed by PM Modi as “historic” for strengthening India‑UK relations

A Historic Deal: Scale & Significance

• The agreement marks the UK’s largest bilateral FTA since Brexit and India’s first major trade deal with a developed economy in over a decade
• It is expected to double bilateral trade—from $60 billion to $120 billion by 2030, and boost annual trade by $34 billion (~£25.5 billion) by 2040

Major Tariff Cuts & Market Opening

• India will eliminate tariffs on 99% of UK imports—covering textiles, food, leather, electronics, medical devices, and more
• The UK will phase in tariff cuts on 90% of Indian exports, including whisky, gin, salmon, cosmetics, machinery, and notably reducing duty on automobiles from 100% to 10% under a quota

Farmer & MSME Win

• Indian agriculture (turmeric, spices, mango pulp, dairy substitutes) and fisheries (shrimp, tuna) gain duty-free access to UK markets
• MSMEs in textiles, leather, seafood, gems & jewellery, footwear are set to benefit from expanded market access and competitive pricing
• Modi noted it “will especially benefit youth, farmers, fishermen and the MSME sector”

Economic Gains for Both Sides

• The deal could add £4.8 billion annually to UK GDP and support £6 billion in investment and exports
• A projected £5 billion boost to the British economy will come through job creation, easier trade, and reduced tariffs
• For India: cheaper access to UK-made medical devices, aerospace parts, and high-tech goods

People & Mobility Provisions

• The agreement includes provisions for 1,800 professional visas annually—covering chefs, yoga instructors, artists—with a three-year national insurance exemption for intra-company transfers

Shared Values & Strategic Cooperation

• Modi described the deal as “not just economic but a plan for shared prosperity”
• The two leaders agreed on enhanced cooperation on security, counter‑terrorism, climate action (carbon border tax), and human rights

Leader Quotes at Chequers

What Remains to Be Done

• The deal requires ratification by both parliaments, likely within the next year
• Ongoing negotiations remain on the bilateral investment treaty, financial/legal services, and UK’s carbon border adjustment mechanism, with some criticism over the lack of strong climate clauses

Final Takeaway

This landmark FTA isn’t just economic—it’s symbolic of a deeper strategic partnership between India and the UK. By slashing tariffs, easing mobility, and promoting shared prosperity, the deal paves the way for enhanced trade, investment, and geopolitical alignment. As PM Modi aptly described, today marks “a historic day for India and UK bilateral relations”