Announced by: Prime Ministers Narendra Modi (India) and Keir Starmer (UK)
Posted by: Ministry of Commerce & Industry, 6 May 2025
🔑 Key Highlights
- Zero Duty Access:
- 99% of Indian exports will benefit from zero tariff access to the UK market.
- Covers almost 100% of the trade value between the two nations.
- Beneficiary Sectors (Goods):
- Labour-intensive: Textiles, marine products, leather, footwear, sports goods, toys.
- High-value: Gems & jewellery, engineering goods, auto parts, engines, organic chemicals.
- Beneficiary Sectors (Services):
- IT/ITeS, financial, professional, educational, business-related services.
- Enhanced digital and professional services access.
- Job Creation & Growth:
- Expected to boost employment in India.
- Enhances India’s competitiveness in UK markets.
- Opens avenues for youth mobility and skilled professional migration.
💼 Social Security Exemption (Double Contribution Convention)
- Indian workers in the UK (and their employers) are exempt from paying social security for 3 years.
- Reduces cost burden → improves service providers’ competitiveness.
🤝 Strategic & Economic Significance
- Aligns with Viksit Bharat 2047 vision.
- Enhances bilateral trade (USD 60 billion in 2024) – projected to double by 2030.
- Encourages:
- Sustainable and inclusive growth
- Resilient supply chains
- High-quality employment
🌐 Mobility & Global Integration
- Simplifies travel and work for:
- Business visitors
- Contractual Service Suppliers
- Intra-Corporate Transferees (and their dependents with right to work)
- Independent professionals (yoga instructors, musicians, chefs)
- Strengthens India’s participation in global value chains.
⚙️ Regulatory Provisions
- Addresses non-tariff barriers to ensure fair market access.
- Promotes good regulatory practices and transparency.
- Enhances ease of doing business in line with domestic reforms.
🏁 Statements by Indian Leadership
- PM Modi: “A historic milestone… It will catalyse trade, investment, growth, job creation, and innovation.”
- Commerce Minister Piyush Goyal: “Not just trade in goods and services, but also about people, possibilities and prosperity.”
- Commerce Secretary Sunil Barthwal: “Game changer… Most comprehensive free trade deal ever entered into by India.”
🌍 Global Outlook
Reinforces India–UK partnership as leading democracies and innovation hubs.
Sets a gold standard for future Indian FTAs.
