The agreement, which became operational on Wednesday, is expected to provide Indian exporters with immediate duty-free access to most British tariff lines, particularly benefiting labour-intensive industries such as textiles. In return, the United Kingdom will gain wider access to Indian markets through phased tariff reductions and quotas in sectors including automobiles.
India’s Commerce and Industry Minister Piyush Goyal described the agreement as a “defining milestone in India-UK ties” in a post on X. He said the India-UK Free Trade Agreement would create significant opportunities for textiles, leather, gems and jewellery, engineering goods, marine products, chemicals, processed foods, micro, small and medium enterprises, farmers and manufacturers.
Goyal added that the agreement would also open new opportunities for India’s information technology, information technology-enabled services, professional, financial, education and business services sectors while supporting greater mobility for Indian skilled professionals.
The trade agreement is expected to boost India’s exports to the United Kingdom while reducing the cost of British imports for Indian consumers and businesses.
A British government policy paper released on Wednesday described CETA as the “best deal that any country has ever agreed with India”. The document stated that India would remove or reduce tariffs, including existing zero tariffs, on 90 percent of tariff lines, covering 92 percent of current goods imports from the United Kingdom based on 2022 trade figures.
The importance of the agreement is highlighted by the United Kingdom’s decision to remove tariffs on almost all Indian goods. India will immediately eliminate duties on 64.1 percent of tariff lines and gradually phase out tariffs on an additional 21 percent while keeping sensitive products excluded from the agreement.
This is a significant moment in the India-United Kingdom partnership!
— Narendra Modi (@narendramodi) July 15, 2026
With the coming into force of the Comprehensive Economic and Trade Agreement and the Agreement on Social Security, our economic linkages are going to get even deeper. Together, these agreements translate our… https://t.co/6yZR0IUfCP
According to data from India’s Ministry of Commerce and Industry, India exported goods worth $13.44 billion to the United Kingdom during the financial year 2025-26, while imports from the United Kingdom stood at $11.68 billion. Bilateral services trade reached $35.44 billion in 2024, with India recording a services trade surplus of nearly $7.9 billion, according to data cited by Reuters.
Prime Minister Narendra Modi, in a post on X on Wednesday, said the economic relationship between India and the United Kingdom would become stronger under the agreement.
“Several vibrant sectors will gain stronger access to the UK market. It will also deepen cooperation in technology, professional services and innovation, while supporting greater mobility for skilled Indian talent,” Modi wrote.
He added that the agreement reflected the trust between the two democracies and their commitment to building a future-oriented partnership based on trade, technology, investment and innovation. He said India and the United Kingdom would continue working together for shared prosperity.
Under the agreement, several British products will become more affordable in India. According to the British policy paper, products such as cosmetics, whisky, chocolates, soft drinks and lamb will benefit from tariff reductions.
Manufacturing sectors are also expected to gain from improved market access, including automobiles, electrical circuits, high-end optical products and medical devices.
The agreement also includes provisions related to professional mobility. Indian workers temporarily relocating to the United Kingdom for employment will be exempted from contributing to National Insurance for a period of five years.
Goyal said that more than 75,000 professionals and over 900 companies are expected to benefit from CETA as it comes into force. He highlighted that sectors including information technology, information technology-enabled services, financial services, professional services, healthcare, education, engineering, telecommunications and consultancy services would gain from the agreement.
Indian exporters will also benefit from the removal of duties on marine products, textiles, leather, footwear and gems and jewellery, allowing Indian suppliers to compete more effectively in the British market.
The agreement will further reduce costs for exports of spices, vegetables, processed food products and fruits to the United Kingdom. With tariff barriers lowered and greater access created for goods and services, the India-UK Comprehensive Economic and Trade Agreement marks a significant step towards strengthening economic cooperation, expanding trade flows and building a deeper strategic partnership between the two countries.
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