Indian Exports to Enter the UK Duty-Free Under New Free Trade Agreement

Indian exports will receive duty-free access to the United Kingdom under the Free Trade Agreement between India and Britain, which is scheduled to be signed on 15 July. The agreement is expected to give a major boost to bilateral trade and open wider market opportunities for Indian businesses.

 

The agreement has been finalised after detailed discussions between the two countries on several trade-related issues. Under the arrangement, nearly 99 per cent of Indian exports will get duty-free entry into the British market. This is expected to benefit a wide range of sectors, including textiles, apparel, marine products, engineering goods and processed food products.

 

According to estimates, the free trade agreement may help increase bilateral trade to around 100 billion dollars by 2030. Along with the trade agreement, a social security agreement will also come into effect. Under this arrangement, Indian professionals working in Britain and their employers will not be required to make social security contributions in the UK for a period of three years. Earlier, this exemption was proposed for three years only.

 

The agreement is expected to create fresh opportunities in innovation, clean energy, infrastructure, start-ups and technology-driven sectors. It is also likely to strengthen economic cooperation between the two countries and provide a new direction to trade and investment relations.

 

At a G-7 programme, Prime Minister Narendra Modi said that the agreement would give a new direction to trade and investment between India and Britain. He stated that the partnership would create new possibilities in sectors such as clean energy, infrastructure, start-ups and innovation.

 

Commerce and Industry Minister Piyush Goyal said that the agreement would provide duty-free access to 99 per cent of Indian exports in the UK market. He added that sectors such as textiles, garments, marine products, engineering goods and processed food would benefit significantly from the agreement. He also said that duties on products such as shoes, especially carpets and handicrafts, would be reduced.

 

Britain has also provided its widest-ever market access in the services sector under this agreement. This is expected to benefit Indian companies working in information technology, financial services, healthcare, education, engineering, telecom and professional services.

 

In the financial year 2025–26, bilateral trade between India and Britain is estimated to grow by 8.6 per cent and reach around 25.12 billion dollars. During the same period, India’s exports to Britain stood at 14.5 billion dollars, while imports from Britain stood at 8.6 billion dollars. Britain is the sixth-largest foreign investor in India. Between April 2000 and March 2026, Britain made direct foreign investment worth 37 billion dollars in India.

 

The free trade agreement is being seen as an important step towards strengthening economic ties between India and Britain. It is expected to help Indian exporters expand their presence in the UK market, while also supporting investment, employment and business growth in both countries.