India-UK Sign Historic Trade Pact: From Cars To Whisky - Check What Gets Cheaper

PM Narendra Modi with UK Prime Minister Keir Starmer (Right). (Photo: @narendramodi/x)

India and the United Kingdom on Thursday signed the biggest trade deal since the UK’s separation from the European Union, marking a significant milestone in bilateral ties.

The landmark agreement will provide better access to goods and services between the two countries, boosting annual bilateral trade by nearly $34 billion.

British Prime Minister Keir Starmer hailed the deal, saying that it will bring huge benefits to both India and the United Kingdom by boosting wages, raising living standards, and putting more money in the pockets of working people. Prime Minister Starmer further claimed that the deal is good for jobs and business.

A key feature of the agreement is a significant reduction in tariffs, with India’s average tariff on UK products coming down from 15% to just 3%.

This will help Indian consumers and industries to access UK-made products, including medical devices and aerospace components, at more affordable prices, enhancing choice and competitiveness.

The agreement also paves the way for better market access in the UK for several Indian sectors such as textiles, footwear, gems and jewellery, seafood and engineering goods.

Additionally, it will create new opportunities for India’s agricultural produce and processed food industries to expand in the UK market.

This deal is also expected to particularly benefit Indian youth, farmers, fishermen and the MSME sector to reach global markets. 

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July 24, 2025

Importantly, the agreement will help Indian agricultural products achieve tariff parity with major European exporters like Germany, while zero duty on textiles and leather will boost India's competitiveness among regional competitors like Bangladesh and Cambodia.

On the other hand, British products, including Scotch whisky, gin, luxury cars, cosmetics and soft drinks, will become more affordable for Indian consumers.

British whisky producers will benefit immensely as tariffs on their products will be halved immediately, from 150% to 75%, and then reduced further to 40% over the next ten years. This will give the UK a strong edge over international competitors in accessing the Indian market.