The United Kingdom and India, the world’s fifth largest economy, have announced the completion of a free trade agreement that both British Prime Minister Keir Starmer and Indian Prime Minister Narendra Modi have hailed as beneficial for their nations.
The agreement aims to boost trade and investment between the two countries, leading to increased economic growth, jobs, and innovation, Modi said on social media platform X.
Negotiations have been ongoing for three years, but the tariffs recently announced by US President Donald Trump made the agreement more urgent. Last year, trade between the UK and India totalled £41 billion, a figure the UK government estimates could increase by more than half by 2040, according to the BBC.
The deal will allow the UK to export goods such as whisky and cars to India at lower costs, while India will face reduced taxes on its exports of textiles and frozen prawns to the UK.
The new measures could take up to a year to come into effect.
Importantly, the UK government has stressed to the BBC that the trade agreement will not alter migration policies.
The European Union is also seeking a free trade agreement with India, which could become the world’s third-largest economy in the future.
