India-UK Free Trade Deal Gets Cabinet Nod, To Be Signed During PM Modi’s London Visit
The Union Cabinet on Tuesday approved the much-anticipated Free Trade Agreement (FTA) between India and the United Kingdom, setting the stage for its signing during Prime Minister Narendra Modi’s visit to London this week. The comprehensive economic pact, which was finalised in May after years of complex negotiations, is poised to significantly reduce tariffs, boost exports, and strengthen the strategic partnership between the two countries.
Prime Minister Modi will embark on an official visit to the UK from July 23 to 24 at the invitation of his British counterpart, Keir Starmer. He will be accompanied by Commerce and Industry Minister Piyush Goyal. During the visit, the two leaders are expected to hold wide-ranging discussions on the entire spectrum of bilateral relations and witness the signing of the landmark trade deal.
“We are working on the legal scrubbing and other last-minute work for the FTA,” Foreign Secretary Vikram Misri said at a briefing on Tuesday. The text of the agreement is expected to be officially signed by the commerce ministers from both nations.
The agreement is the result of 15 rounds of negotiations that began in January 2022. It aims to double the bilateral trade volume to $120 billion by 2030. In the 2024-25 fiscal year, bilateral trade stood at over $22 billion, with India’s exports to the UK reaching $14.5 billion and imports at $8.6 billion.
Under the pact, key Indian sectors such as textiles, leather, footwear, and engineering goods will benefit from the elimination of tariffs on nearly 99% of exports. In return, India will reduce tariffs on several UK goods, including a significant cut on Scotch whisky and cars. The UK has described the agreement as its “biggest and most economically significant bilateral trade deal” since leaving the European Union.
During his visit, Prime Minister Modi will also hold discussions with PM Starmer on regional and global issues and is expected to call on King Charles III.
After the deal is signed, it will require ratification by the British Parliament before it comes into effect. Talks between the two nations on a separate Bilateral Investment Treaty (BIT) are still in progress.
