Relations between India and the United Kingdom witnessed a major step-up with the signing of the Comprehensive Economic and Trade Agreement (CETA) in July 2025. The meeting of the Indian and U.K. Prime Ministers this week in Mumbai signals a deep commitment on both sides to scale up bilateral relations and become true partners in progress.

The visit of the British Prime Minister Keir Starmer will anchor India-U.K. ties in a period marked by shifting trade regimes, geopolitical realignments and intensifying competition for technology, capital and talent.

While awaiting ratification, CETA is already being positioned as a strategic foundation for the bilateral relationship, promising to expand trade, investment and cooperation across a spectrum of sectors. The significance of Mr. Starmer’s visit lies in consolidating these commitments and in situating the partnership within a rapidly changing global economic landscape.

The backdrop to this visit is India’s expanding web of economic partnerships. On October 1, India’s Trade and Economic Partnership Agreement (TEPA) with the European Free Trade Association (EFTA) came into effect. This is India’s first agreement where market access is explicitly tied to investment commitments, with EFTA countries pledging $100 billion of investment over 15 years. Parallelly, negotiations with the European Union, India’s second largest trading partner in goods, with bilateral trade of $136.5 billion in 2024-25, are advancing well.

Building on CETA

At the heart of the October discussions will be the CETA. It is expected to double bilateral commerce by 2030. For India, the pact promises lower tariffs on its exports — from textiles and agricultural goods to pharmaceuticals — while the U.K. secures reduced duties on Scotch whisky, automobiles and other high-value exports. More importantly, the agreement signals a willingness on both sides to blend market access with broader strategic alignment.

Complementing the CETA is the Double Contributions Convention (DCC), which exempts employers of Indian professionals in the U.K. from double social security contributions for up to three years. This will ease mobility for skilled workers and reduce costs for businesses, particularly in services sectors where Indian professionals have played a transformative role.

The ongoing negotiations of a bilateral investment treaty between India and the U.K., alongside the CETA, promise to boost the U.K.’s investments in India. The U.K. is the sixth largest investor, accounting for nearly 5% of India’s foreign direct investment, and these inflows have a potential to increase across sectors, in manufacturing and services. Tariff elimination on a large number of products, regulatory cooperation, and talent mobility provisions will make cross-border operations even more competitive and efficient for British companies and U.K. companies can leverage India as a hub for production and global exports. Indian firms stand to gain through technology partnerships, adoption of global standards and easier access to European markets.

Beyond commerce, strategic road maps

Mr. Starmer’s visit will also provide an opportunity to review progress under the Vision 2035 road map for India-U.K. relations. This framework envisages deeper cooperation in defence, technology, climate action, education and mobility. The Defence Industrial Road map, unveiled in July, is expected to feature prominently, with an emphasis on joint development and co-production of advanced platforms.

Equally significant is the Technology Security Initiative (TSI) launched in 2024, which brings together the National Security Advisers of the two countries to drive collaboration in sensitive technologies — artificial intelligence, quantum computing, semiconductors, critical minerals, and advanced materials. This reflects the growing recognition that economic and security domains are now inseparable.

Cooperation in challenging times

The true salience of Mr. Starmer’s visit lies in timing and trajectory. The world economy is fragmenting into regional trading blocs even as global value chains are being restructured around resilience and security. The CETA provides an opportunity for both sides to enhance their economic cooperation and contribute to economic growth.

For Britain, India offers access to a vast and growing market, opportunities for collaboration in green finance and digital innovation, and a geopolitical partner in the Indo-Pacific. For India, the U.K. relationship provides advanced technology, investment flows, defence partnerships and expanded opportunities for its services and skilled workforce.

It is time to set contours of a next-generation India-U.K. partnership: one that combines trade liberalisation with joint investments in sustainability; tariff reductions with mobility frameworks for talent; and defence procurement with co-development of critical technologies.

For Indian industry, this is an opportunity to highlight sectors where synergies can be rapidly scaled — renewables, electric mobility, digital finance, aerospace and higher education. For policymakers, it is a moment to align regulatory frameworks, reduce barriers, and ensure that CETA’s benefits are widely realised.

Ultimately, Prime Minister Narendra Modi and Mr. Starmer will be looking to send a signal that transcends the bilateral. By deepening their partnership, India and the U.K. can position themselves not only as trusted economic partners but also as co-architects of a more resilient, open, and technology-driven global order.

Harsha Vardhan Agarwal is President, The Federation of Indian Chambers of Commerce and Industry (FICCI)

Published – October 09, 2025 12:08 am IST