The government has used the formal signing of the UK-India trade deal to claim that the agreement will secure thousands of British jobs and billions in exports, as leaders of both countries met to put pen to paper on the much-heralded deal.
Yesterday (23 July), UK prime minister, Sir Keir Starmer, met with his Indian counterpart, Narendra Modi, for the signing of the deal.
The government claims that this will boost UK GDP by £4.8bn every year, with a collective wage increase of £2.2bn each year.
Tariff win
Among the benefits of the deal is a reduction in tariffs. The Department for Business and Trade (DBT) claims that this reduction will increase UK exports to India by 60% in the medium term.
Starmer said:
“Our landmark trade deal with India is a major win for Britain. It will create thousands of British jobs across the UK, unlock new opportunities for businesses and drive growth in every corner of the country, delivering on our Plan for Change.
“We’re putting more money in the pockets of hardworking Brits and helping families with the cost of living, and we’re determined to go further and faster to grow the economy and raise living standards across the UK.”
‘Welcome step forward’
Director general of the Chartered Institute of Export & International Trade, Marco Forgione, called it a “welcome, long-awaited step forward” for the business community. He said:
“The intention that the trade deal will drive regional economic benefits to the UK is significant. We know that the value of UK goods exports to India in 2024 varied significantly by region, with London exporting £1.8bn to India, while the North East exported only £100m.
“With the increased export opportunities, as well as analysis showing that communities across every region of the UK will benefit from the overall uplift to UK GDP, this deal is a win for regional economies.
“Beyond goods exports, the benefits of the access to India’s thriving services sector is not to be underestimated, particularly as India’s economy has remained largely resilient, despite recent geopolitical challenges. There are huge opportunities to be explored, and the Chartered Institute of Export & International Trade stands ready to advise businesses on how best to take advantage of these benefits.”
Part of ‘change’
DBT secretary, Jonathan Reynolds, said that the benefits would reach “all the regions and nations of the UK”, and was part of delivering the government’s ‘Plan for Change’.
He added:
“The almost £6bn in new investment and export wins announced today will deliver thousands of jobs and shows the strength of our partnership with India as we ensure the UK is the best place in the world to invest and do business.”
Modi and Starmer also signed a Comprehensive and Strategic Partnership, which is aimed at boosting collaboration on defence, education, climate and other key areas.
The agreement needs to be ratified by both countries. In the UK, Parliament will have a set period to scrutinise the bill.
Under the constitutional process, the government must send the text and explanatory notes of the agreement to parliament, allowing 21 days for review. The House of Commons can delay ratification by 21 days by passing a resolution, while the House of Lords can only advise on the agreement.
Background
The deal was originally agreed to on 6 May 2025, following years of negotiations.
A deal with India had been long sought by the UK. Government sources told business leaders in April that both sides were “nearly there” on a deal.
Three successive Conservative administrations had talked up the possibility of reaching an agreement, including then-prime minister Boris Johnson’s promise of a ‘deal by Diwali’ in 2022, as part of a “Brexit bonus”.
