Indian Prime Minister Narendra Modi and Prime Minister of the United Kingdom will be signing the much anticipated free trade agreement, announced in the month of May, later today. A UK statement, confirming that the trade agreement will be signed later today, said that it will boost bilateral trade by £25.5bn every year. The signing of the free trade agreement is seen as a significant milestone in economic ties between the 2 countries, one that comes even as India is in talks with the European Union and United States for trade agreements.
Terming the trade agreement as a “landmark” UK PM Keir Starmer said that it is a “major win for Britain” and will “create thousands of British jobs across the UK, unlock new opportunities for businesses and drive growth in every corner of the country, delivering on our Plan for Change.” The agreement is seen as UK’s most economically significant bilateral trade deal since leaving the European Union and significantly improves market access for businesses in both countries.
The UK estimates that the trade agreement will not only create jobs and help accelerate growth of the British economy, but benefits the Indian consumers with improved access to the British products – from soft drinks and cosmetics to cars and medical devices – as average tariffs will drop from 15% to 3%. The bilateral trade between the two countries crossed $55 billion in 2023-24. The UK is the sixth largest investor in India, with a cumulative investment of $36 billion. India itself is a large source of Foreign Direct Investment in the UK, with a cumulative investment of close to $20 billion. There are close to a thousand Indian companies in the UK that provide employment to nearly 100,000 people and have a cumulative revenue of over $91 billion.
Welcoming the signing of the Free trade agreement, UK’s Business and Trade Secretary Jonathan Reynolds said, “the almost £6 billion in new investment and export wins announced today will deliver thousands of jobs and shows the strength of our partnership with India as we ensure the UK is the best place in the world to invest and do business.” The next step for the UK Government will be to prepare for the trade agreement to be ratified by Parliament.
PM Modi is currently on a UK visit, his fourth visit to the country since assuming office. He has been to the country in 2015, 2018 and was there in 2021 for the COP26 summit in Glasgow. Within the last year itself, Prime Minister Modi and Prime Minister Starmer have already met twice, first on the sidelines of the G20 summit in Rio de Janeiro last year, and then, in June this year, in Kananaskis in Canada, on the sidelines of the G7 summit. Both countries will also unveil a renewed Comprehensive Strategic Partnership – the UK-India Vision 2035 – later today. PM Modi will also meet King Charles III.