The United Kingdom and India reached a landmark Free Trade Agreement (FTA) on 6 May 2025, creating major opportunities for increased trade and investments between the countries. Hailed by the UK government as the most significant bilateral trade deal since Brexit, the agreement has the potential to reshape commercial ties between the two economies. The deal also comes at a pivotal moment for India, which is seeking to build resilience amid global trade headwinds and external shocks, most recently illustrated by the implementation on 27 August 2025 of US tariffs of 50% on Indian goods.
The FTA builds on the Enhanced Trade Partnership (ETP) announced in May 2021, which formed part of the broader “2030 Roadmap” for UK-India relations. The roadmap envisioned closer collaboration across trade, defence, climate and health. Now, with a formal FTA agreed, businesses can prepare for a new era of trade marked by reduced tariffs, improved regulatory alignment and wider market access.
For the UK, the FTA demonstrates its post Brexit ability to negotiate independent trade deals. Since leaving the EU in December 2020, the UK has sought to cement bilateral relationships with high growth economies. India, projected to become the world’s third largest economy by 2035, appears to be a natural partner.
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