What Gets Cheaper After Historic India-UK Trade Deal

The free trade agreement will bring significant benefits to India by opening new avenues of growth, skill development, and employment

July 25, 2025: On Thursday, the India-UK Free Trade Agreement was signed and formalised, during Prime Minister Narendra Modi’s visit to the UK.

The trade deal had been under negotiations for three years and is expected to boost bilateral trade between the two economies by $34 billion annually.

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The FTA will benefit not just the youth looking to build careers in information technology, financial services, professional services, management consultancy, architectural and engineering, and more, but will also support young entrepreneurs, and Indian graduates to pursue careers in the UK.

“Our landmark trade deal with India is a major win for Britain. It will create thousands of British jobs across the UK, unlock new opportunities for businesses and drive growth in every corner of the country, delivering on our Plan for Change,” said PM Starmer.

26 British companies have announced new business in India.

How India benefits from the trade deal

1. Now, Indian industries and people will be able to access medical devices, aerospace parts made and imported from the UK at a much cheaper cost.

2. British products such as soft drinks, cosmetics, chocolates, biscuits, lamb, salmon and cars will also be easily accessible to Indians, as the average tariffs will drop from 15 per cent to 3 per cent after the free trade agreement comes into effect. Electric vehicles will see a tariff cut from 110 per cent to 10 per cent within a quota.

3. After the trade deal comes into operation, it will be easier for British firms to export whisky and other products to India per PTI. Import duty on whisky will fall from 150 per cent to 75 per cent immediately and to 40 per cent over 10 years.

4. Apart from products, the trade agreement also makes it easier for Indians to live in the UK as firms and freelancers will have access to 36 service sectors in the UK with no ‘Economic Needs Test’.

5. Indian professionals will now be able to work in 35 sectors in the UK for 2 years even without an office in the country. The commerce ministry has stated that the move could benefit more than 60,000 IT professionals each year. Major beneficiaries include TCS, Infosys, Tech Mahindra, HCL Technologies, and Wipro.

6. Indian professionals will also be exempted from UK social security payments for 3 years under the agreement.

7. The deal also helps professionals such as chefs, yoga teachers, musicians and other contract-based workers by helping them enter the UK job market. 

How UK benefits from the trade deal

1. The deal will lead to major cuts in Indian tariffs with reductions secured on 90 per cent of tariff lines. In 10 years, 85 per cent of these will be exempt from tariffs.

2. UK businesses will gain expanded access to public procurement opportunities in India.

3. British companies will be able to bid on non-sensitive government tenders valued above Rs 2 billion. This means, the UK can potentially participate in 40,000 tenders each year, collectively worth around Rs 4.09 lakh crore.

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4. The UK will be able to create over 2,200 jobs as a direct result of the trade agreement.

5. UK workers will also see a wage hike of up to 2.2 billion pounds each year.

British people will see cheaper prices and more choice on clothes, shoes, and food products.