July 24, 2025

Indian Prime Minister Narendra Modi has signed a free trade deal with Prime Minister Sir Keir Starmer in a multi-billion pound export boost. The deal aims to make UK cars and whisky cheaper to export to India, and Indian textiles and jewelry more affordable to export to the UK. The agreement, which took three years to reach, also includes a new India-UK plan to address illegal migration. Despite concerns raised by opponents about potential undercutting of British workers due to extended social security terms, UK Business Secretary Jonathan Reynolds emphasized that Indian workers on temporary secondment to the UK would receive the same benefits already offered to workers from other countries. During the signing of the deal at the UK Prime Minister's country residence Chequers, Sir Keir described the UK-India agreement as the most economically significant trade deal Britain has made since Brexit. The deal is expected to create over 2,200 British jobs as Indian firms expand their operations in the UK and British companies secure new business opportunities in India. This trade agreement, as Sir Keir noted, marks a significant step in the strong historical, familial, and cultural ties between the two countries, aiming to further strengthen their relationship. Modi hailed the agreement as a blueprint for shared prosperity, citing improved market access for Indian goods in the UK and vice versa. The UK government estimates that the deal will boost the British economy by £4.8 billion annually. While the Indian cabinet has approved the deal, it is pending agreement by the UK parliament and is expected to take about a year to come into effect. The trade deal involves lower tariffs on a wide range of products, including clothing, cars, food, jewelry, and gems. It is anticipated to facilitate economic growth and job creation, particularly through increased UK exports to India. The agreement will significantly reduce tariffs on UK exports to India, making it more convenient for British companies to access the Indian market. Moreover, the trade deal extends collaboration between the two nations in defense, education, climate, technology, and innovation, aiming to address issues such as corruption, organized crime, and irregular migration. Discussions are ongoing regarding further access to India's financial and legal services industries, a bilateral investment treaty, and UK plans for a tax on high-carbon industries, among other matters. Notably, the agreement highlights the exemption on national insurance contributions for staff temporarily transferred between Indian and UK companies, ensuring social security obligations only in the home country. The UK government emphasizes existing reciprocal agreements with various countries, ensuring fair treatment for workers from both nations. In conclusion, the trade deal signals a significant milestone in the economic partnership between the UK and India, offering mutual benefits in terms of increased trade, job creation, and enhanced cooperation across various sectors. Both countries are optimistic about the positive impact of this agreement on their economies and look forward to further strengthening their ties through continued collaboration and dialogue.

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Tags: India, Uk, Trade deal, Economy, Brexit,