UK-India FTA: Good News For These Sectors?

In a major breakthrough, India and the United Kingdom have officially signed a comprehensive Free Trade Agreement (FTA), marking a new chapter in bilateral relations and unlocking fresh opportunities across a range of sectors. The deal, finalised after years of negotiation, is being hailed as a milestone for both post-Brexit Britain and a rapidly globalizing India.

The agreement, one of the most comprehensive trade pacts India has signed with a developed economy, is expected to strengthen bilateral trade, increase investment flows, and enhance cooperation across a wide range of sectors. It also includes a Double Contribution Convention, aimed at easing social security burdens for Indian professionals working in the UK.

Welcoming the development, Harsha Vardhan Agarwal, President of the Federation of Indian Chambers of Commerce and Industry (FICCI), said the deal goes far beyond tariff cuts.

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“The India-UK Free Trade Agreement is not just a trade pact—it’s a bridge to shared prosperity,” he said. “It brings new momentum to sectors like FMCG, healthcare, and innovation-driven enterprises.”

He credited the leadership of Prime Minister Narendra Modi for steering the agreement to conclusion and said the pact reflects India’s growing role as a trusted global partner.

Boost for key sectors

Industry experts say Indian exporters, particularly in sectors such as pharmaceuticals, textiles, food processing, and light manufacturing, stand to benefit from greater market access and reduced duties. Under the terms of the agreement, 99 percent of Indian exports to the UK will enjoy zero-duty access.

The services sector also received a major boost. The pact includes provisions for easier mobility of professionals, mutual recognition of qualifications, and a three-year exemption from social security contributions for Indian workers in the UK. These measures are expected to lower the cost of doing business and facilitate smoother cross-border operations for Indian IT and consultancy firms.

FICCI noted that many of the long-standing demands of Indian industry — including better access for goods and services, and relief from double social security payments — have been addressed in the final agreement.

“It is heartening to see key asks from industry being taken on board,” Agarwal said. “We are hopeful that Indian businesses will fully leverage the opportunities created by this deal and expand their footprint in the UK market.”

Bilateral trade gets a major fillip

The UK is already a significant trade partner for India, with total trade in goods and services exceeding $50 billion. The new agreement is expected to accelerate that figure over the next few years.

Nirmal Jain, Founder of the IIFL Group, described the deal as “game changing.” In a statement, he said, “This FTA delivers zero-duty access for the majority of Indian exports, opens big opportunities for services, and supports MSMEs through global value chain integration. It’s a bold step toward India’s vision of Viksit Bharat 2047.”

The deal comes at a time when global trade remains volatile due to geopolitical tensions and shifting alliances. In that context, the India-UK FTA is seen as a strategic move to deepen economic engagement and offer businesses a more stable and predictable framework.

As the fine print of the agreement rolls out in the coming weeks, the focus will now shift to implementation — and how effectively Indian industry can capitalise on this rare window of global opportunity.