UK-India FTA marks pivotal shift in global trade dynamics: Expert

The report said that the multi-billion-pound deal will reduce tariffs on 90 per cent of traded goods, helping businesses on both sides.

New Delhi:

The free trade agreement (FTA) between India and the United Kingdom is expected to boost India’s rapid economic growth. Commerce Secretary Sunil Barthwal termed it a “game changer” and said it is the most comprehensive trade deal India has ever entered into.

“This is the most comprehensive free trade deal ever entered into by India and will be the gold standard for our future engagements. It opens up export opportunities for sectors such as textiles, marine products, leather, footwear, sports goods and toys, gems and jewellery,” Barthwal was quoted as saying by PTI.

Meanwhile, a report by SBI Research said that the FTA is part of a new global trade strategy that aims to reduce dependence on China, manage trade challenges from US tariffs, and help the UK reshape its economy after Brexit.

Moreover, the report said that the multi-billion-pound deal will reduce tariffs on 90 per cent of traded goods, helping businesses on both sides.

Commenting on the development, Ankit Patel, Partner at Arunasset Investment Services, said that the UK-India Free Trade Agreement marks a pivotal shift in global trade dynamics, especially in the post-Brexit and post-pandemic context. 

“As Western economies look to de-risk from China, India presents a natural partner: a large consumer base, rising manufacturing capacity, and shared democratic values. This deal goes beyond tariffs, it opens pathways for high-end manufacturing, supply chain relocation, and smoother service-sector collaboration. We’re particularly bullish on sectors like pharmaceuticals, electronics, and speciality chemicals, where India can replace China as a preferred supplier to the West. For the UK, it’s a strategic diversification move; for India, it’s an invitation to scale up and modernise. The geopolitical undertone is clear: the world is rewiring its trade routes, and India is now firmly in the driver’s seat. We see this as a catalyst for multi-decade capital inflows and a re-rating of Indian export-led industries,” Patel said.

India’s trade share with the UK has already grown from 1.69 per cent in 2022-23 to 1.91 per cent in 2024-25. Total bilateral trade stands at around USD 60 billion and is projected to double by 2030. In FY25, India’s exports have grown even as imports saw a decline of 6.1 per cent.

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