India and UK Finalize Historic Trade Agreement

India and the United Kingdom have concluded a landmark free trade agreement (FTA) on May 6, 2025, after more than three years of negotiations. This agreement aims to significantly enhance bilateral trade and economic cooperation between the two nations.

Under the terms of the FTA, 99% of Indian exports to the UK will become duty-free, benefiting sectors such as textiles, leather, footwear, and processed foods. This move is expected to boost India's exports and provide greater market access for Indian manufacturers.

Conversely, the UK will reduce import tariffs on certain goods, including luxury cars and whisky. The import duty on British cars will decrease from 110% to 10%, and whisky tariffs will be reduced from 150% to 40% over a period of ten years. These reductions are anticipated to make British products more competitive in the Indian market.

Additionally, the agreement includes provisions to facilitate the movement of professionals between the two countries, enhancing opportunities for skilled workers and fostering closer economic ties.

Both Indian Prime Minister Narendra Modi and UK Prime Minister Rishi Sunak have hailed the agreement as a significant step forward in strengthening the India-UK economic partnership, with expectations to double bilateral trade to $120 billion by 2030.