India, UK Sign Free Trade Deal in ‘Historic Milestone’, Says PM Modi

India and the United Kingdom have officially concluded a deal, “ambitious and mutually beneficial”, called by Prime Minister Narendra Modi called which is a long awaited, major free trade agreement (FTA). The deal is expected to strengthen the strategic partnership bettwo countries’ while boosting trade, investment, and economic growth.

The announcement was made on Tuesday following a call between Modi and UK Prime Minister Keir Starmer, who also hailed the deal as a significant achievement. “These landmark agreements will help strengthen our Comprehensive Strategic Partnership, driving growth, job creation, and innovation in both economies,” Modi wrote in a post on social media. He also looked forward to welcoming Starmer to India in the near future.

This deal comes three years after Modi and former UK Prime Minister Boris Johnson set the goal of finalizing it by October 2022. However, the process was delayed due to disagreements over issues like tariffs on alcohol and automobiles, as well as political instability in the UK.

In a joint statement, both leaders emphasized that the agreement would create new opportunities for businesses, foster stronger economic connections, and strengthen ties between the two nations. Starmer noted that the deal is a key part of the UK’s “Plan for Change,” aimed at strengthening global alliances and reducing trade barriers to bolster the UK economy.

The breakthrough follows intensive efforts, including two visits to the UK by Indian Commerce Minister Piyush Goyal, who met with British Trade Secretary Jonathan Reynolds to push the talks to completion.

Trade between the two countries has been growing steadily. According to recent UK government data, India was Britain’s 11th largest trading partner in the year ending Q4 2024, accounting for 2.4% of total UK trade. The total trade in goods and services reached £42.6 billion, an 8.3% increase from the previous year. India’s exports to the UK were worth £25.5 billion, up 10.1%, while UK exports to India rose by 5.8% to £17.1 billion.

Further details of the trade agreement are expected to be released later on Tuesday.