Britain and India have agreed on a major trade deal during Indian Prime Minister Narendra Modi’s visit to the UK. This agreement aims to strengthen economic ties and create new business opportunities for both countries.
The trade deal was finalized after over three years of negotiations. It is expected to boost bilateral trade by £25.5 billion (around $34 billion) by the year 2040. This is Britain’s largest trade agreement since leaving the European Union in 2020.
Once approved by the UK parliament and India’s federal cabinet, the deal will lower tariffs on many products. Key items affected include textiles, cars, and Scotch whisky. The agreement also improves access for services and makes business travel easier between the two countries.
UK Prime Minister Keir Starmer called the deal a “major win” for Britain. He said it will create thousands of new jobs and support growth in many industries.
A significant part of the agreement is the reduction of tariffs on Scotch whisky. The current tax of 150% will fall to 75% immediately, and then to 40% over ten years. Tariffs on British cars entering India will also decrease, though some limits will apply initially.
India will benefit as well, with 99% of its exports to the UK facing zero tariffs under the new agreement. This includes textiles and other labor-intensive goods.
While the economic boost to the UK is expected to be modest, with an estimated GDP increase of £4.8 billion by 2040, officials see the deal as an important step in strengthening post-Brexit trade relations.
Beyond economic matters, the two nations plan to deepen cooperation in defense, climate change, and cybersecurity.
This new trade agreement marks a significant milestone in UK-India relations and highlights growing ties between the two countries.
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