India UK FTA – Who Benefits?

A landmark bilateral trade deal, the India UK FTA is designed to benefit both countries and bolster regional cooperation

While it is commonly being referred to as the India UK FTA, the deal is technically named as the Comprehensive Economic and Trade Agreement (CETA). The India UK FTA deal was concluded on 6th May 2025 and officially signed on 24th July 2025. The deal is aimed at boosting economic ties between India and the UK in a significant manner. Let us get more details on India UK FTA and see how both countries stand to gain.

India UK FTA – Overview

The India UK FTA covers various segments such as digital trade, goods and services, intellectual property, investment and sustainability. The immediate goal is to increase the trade between the two countries to around US$100-120 billion by 2030. Another US$40 billion is planned to be added by 2040.

The India UK FTA will use the expertise of each country to benefit the joint ecosystem. For example, India will allow access to its manufacturing prowess and rapid growth. Similarly, the UK will lend its expertise in innovation, services and high-value exports. The deal will become fully active after it is approved by the parliament in the UK.

A number of changes will take place to make the India UK FTA operational. It will include things like tariff reduction, enhanced market access for both nations, streamlined customs procedures, digital trade facilitation, gender equality, maintaining environmental standards and mutual recognition of professional qualifications.

India UK FTA is India’s first comprehensive trade agreement with a major European country. Similarly, it is the most significant trade deal for the UK in the post-Brexit era. The deal will see technology transfers, new investments and sustainable growth. It will create new job opportunities, improve supply chains and help India to become the world’s third-largest economy.

India UK FTA – Benefits for India

Tariff reduction – This is a major gain since tariffs on around 99% of India’s exports will be reduced. This will benefit various industries in India such as apparel, textiles, footwear, leather, engineering goods, gems and jewelry, marine products, auto parts, toys, sports goods and organic chemicals.

Access to UK expertise and investment – India will gain access to new investment and technology transfers. There will be increased collaborations in areas like clean energy, pharmaceuticals, digital trade and innovation. The trade deal positions India as an investment-friendly destination. The movement of skilled workers will be simplified, which will help India’s IT and services exports.

Overall, the India UK FTA is set to boost inclusive growth in India via new job creation and supply chain integration. India will also get access to UK government procurement markets, which offer billions in opportunities. India will emerge as a manufacturing hub and cater to the needs of its burgeoning middle class.

India UK FTA – Benefits for the UK

Gains for the UK are similar to that of India. For example, the UK’s GDP is expected to witness a boost of around US$6.59 billion. The UK will gain access to India’s large market with tariff reduction on 90% of UK’s exports. Key industries to benefit include whisky, gin, automobiles, cosmetics, medical devices, fisheries, chocolate, biscuits and electrical machinery.

In the services sector, UK firms will gain across areas like construction, telecom, environmental consulting and financial services. After the trade deal, there will not be any new discriminatory barriers or residency requirements. UK-based entities will have access to the Indian government procurement market, which is estimated to be around US$ 52 billion.

There will be regional benefits as well with the India UK FTA. For example, Scotland will gain in beverages, whereas Northern Ireland will benefit from services. Similarly, England will benefit in manufacturing and logistics whereas Wales will see increased demand for agri-food items like lamb. SMEs will benefit via reduced trade barriers. The UK will continue to maintain standards across food safety and the NHS.