**UK and India Forge Historic Trade Partnership After Years of Negotiation**

Thu May 08 2025 02:57:08 GMT+0300 (Eastern European Summer Time)
**UK and India Forge Historic Trade Partnership After Years of Negotiation**

**New trade deal promises significant economic boost and easier market access for goods.**


**The agreement, hailed as a major win for both nations, sets the stage for increased trade and collaboration, with specific benefits outlined for various sectors.**



The United Kingdom and India have successfully concluded a comprehensive trade agreement, marking a significant milestone in their economic relations following three years of complex negotiations. This landmark deal facilitates smoother access for UK businesses to export key products like whisky and automobiles to India, while simultaneously reducing tariffs on Indian clothing and footwear entering the UK market.

Prime Minister Sir Keir Starmer emphasized the deal as a pivotal move for the British economy, predicting it will generate an annual uplift of £25.5 billion by 2040 and strengthen trade ties, which already totaled £42.6 billion in the previous year. His sentiments were echoed by India's Prime Minister Narendra Modi, who described the agreement as "ambitious and mutually beneficial," with the potential to catalyze job creation and drive economic growth in both countries.

Under the terms of the agreement, tariffs on several goods will see substantial reductions. For instance, tariffs on gin and whisky will be halved to 75%, and the previously imposed 100% tariffs on premium UK cars will dramatically decrease to 10%, albeit under a quota system. Additionally, a variety of UK exports, including aerospace technology and food products, will benefit from lower levies, enhancing the competitive edge of British firms.

Moreover, the deal introduces modifications in the services sector and procurement regulations, enabling UK businesses to pursue more opportunities in India. Notably, it includes an exemption from social security payments for Indian professionals temporarily operating in the UK, a measure lauded by Indian officials as a significant achievement. This provision, applied to workers transferred between the nations, allows for social security contributions to remain payable in the employees' home country only.

Despite the positive outlook, the agreement has sparked criticism from opposition parties. Some have raised concerns over the implications of dual tax exemptions and the impact on local businesses. Kemi Badenoch, the opposition leader, voiced her apprehensions, highlighting perceived discrepancies in the tax framework following Labour's recent employer national insurance contribution increase.

Trade experts and industry leaders have welcomed the agreement, viewing it as a necessary counteraction to rising protectionism in global markets. Rain Newton-Smith, Chief Executive of the CBI, asserted that the deal represents a "beacon of hope" amid increasing global trade tensions.

As India continues to emerge as a significant economic power, projecting the potential to become the world's third-largest economy, the UK is keen to solidify its standing as a key trading partner. With ambitious export enhancement goals from India's government, both nations are poised to navigate a future of increased economic collaboration and innovation, marking a new chapter in their bilateral trade relations.

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