India UK Free Trade Deal Signed Major Tariff Cuts on Whisky, Cars and Textiles in 2025
India and the UK have Signed a historic Free Trade Agreement on July 24, 2025, reducing tariffs on whisky, garments, cars, and more. Discover how this deal will boost exports and reshape trade relations.
By Raja Awais Ali
7/23/20251 min read
India–UK Free Trade Agreement Finalized: Key Sectors to Gain Big
London, July 24, 2025 — In a significant diplomatic and economic milestone, India and the United Kingdom have officially signed a landmark Free Trade Agreement (FTA). This pact is set to reshape bilateral trade by cutting or eliminating tariffs on over 99% of Indian exports and providing British exporters easier access to the vast Indian market.
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What Is the India–UK Free Trade Agreement?
The FTA is a formal economic pact between the two countries aimed at promoting free trade, investment, and economic cooperation. Negotiations began in 2022 and concluded after 14 rounds of intense discussions.
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What’s Included in the Deal?
The agreement offers major benefits for both nations:
For India:
Zero tariffs on 99% of Indian exports to the UK.
Boost to textile, leather, jewelry, and engineering sectors.
Easier work visa pathways for Indian IT and health professionals.
Protection for Geographical Indication (GI) tags like Basmati rice and Darjeeling tea.
For the UK:
Tariff cuts on whisky from 150% to 75%, and further to 40% in 10 years.
Lowered duties on British luxury cars, cosmetics, and medical equipment.
Export growth for Scottish whisky, pharmaceuticals, and education services.
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Expected Impact
Projected $120 billion trade volume by 2030 (currently $55 billion).
Strengthened collaboration in green tech, defense, AI, and education.
Social security agreement to avoid double contributions for temporary workers.
Leaders’ Statements
PM Narendra Modi: "This FTA represents a new era of economic partnership between India and the UK."
UK PM Keir Starmer: "It opens doors for British companies and supports our vision of Global Britain."
Why This Matters ?
This FTA is seen as a strategic win for both sides:
India gains enhanced access to a top global market.
The UK, post-Brexit, secures its biggest trade pact yet outside the EU.
Experts view the agreement as a model for future trade deals with other G20 nations.
Summary Table
Sector Tariff Before New Tariff Benefit
Whisky (UK) 150% 75% → 40% Lower prices, UK exports rise
Textiles (India) 10–12% 0 Boost for Indian SMEs
Cars (UK) 100 10% (Quota) British luxury car access
Pharma (India) 8–10% 0 Access to NHS and EU markets