UK-India FTA Signed: Who Wins, What’s Cheaper, and How It Impacts You!

The recently signed India-UK Free Trade Agreement (FTA) on 24 July 2025 marks a transformative moment in bilateral economic ties. With this deal, tariffs on a wide range of products will be reduced or eliminated, making numerous imported goods cheaper for Indian consumers, while simultaneously boosting Indian exports. Key items such as Scotch whisky, British luxury cars, chocolates, and cosmetics will see significant price drops over time. The agreement is expected to benefit both nations’ consumers, industries, and employment landscape.

Background

Negotiations for the FTA began in January 2022, and after over three years of talks and several rounds of diplomacy, it was officially signed during PM Narendra Modi’s visit to the UK in July 2025. This FTA is being hailed as India’s most comprehensive trade pact and the UK’s most important bilateral trade deal post-Brexit.

Significance of the Agreement

• It eliminates duties on 99% of Indian exports to the UK.
• For Indians, high-end imports like whisky, cars, chocolates, and medical devices will become more accessible.
• The agreement is forecasted to boost UK’s GDP by £4.8 billion ($6.5 billion) annually.
• Aims to double Indian exports to the UK by 2030.

Objectives

• Promote affordable and wider access to goods and services.
• Encourage investment and innovation.
• Support MSMEs and exporters in both nations.
• Facilitate temporary movement of skilled professionals.
• Reduce non-tariff barriers and improve market access.

What Will Become Cheaper for Indians?

1. Scotch Whisky & Gin

• Tariffs on Scotch whisky and gin will be reduced from 150% to 75% initially, and to 40% over the next 10 years.
• Major boost for premium liquor brands like Diageo.

2. British Luxury Cars

• Import duties on UK-made cars, currently above 100%, will reduce to 10% under a quota-based system.
• This benefits carmakers like Jaguar Land Rover and Aston Martin.

3. Chocolates, Biscuits & Salmon

• Lower duties on British-made chocolates, biscuits, and salmon, bringing them to supermarket shelves at better prices.

4. Cosmetics & Personal Care

• Reduced tariffs on cosmetics and skincare products, especially from leading British brands.

5. Medical Devices

• Easier access to UK-manufactured medical devices and diagnostic equipment at reduced costs.

Who Benefits in India?

1. Textile & Leather Exporters

• Removal of UK duties (up to 12%) on garments, home textiles, and leather goods will boost exports and create jobs.

2. Gems & Jewellery Sector

• Zero tariffs on gold, diamonds, and jewellery will benefit Indian exporters and promote Indian craftsmanship.

3. Agro, Pharma & Processed Foods

• Sectors like rice, spices, shrimp, tea, and processed food will see tariff reductions.
• Indian pharma companies gain easier entry into the UK market.

4. Electric & Hybrid Vehicles

• Preferential access for EV and hybrid vehicle makers under a quota system.
• Companies like Tata Motors, Mahindra Electric, and Bharat Forge stand to gain.

5. Professionals & Skilled Workers

• UK will streamline visa and work permits for Indian professionals including chefs, yoga instructors, musicians, and more.
• Social security exemption for Indian workers in the UK for up to 3 years, saving approx. ₹4,000 crore annually.