India-UK FTA to Start July 15, Deal Opens Duty-Free Access for Exports

The India-UK FTA will open a new phase in trade between the two countries by improving market access and reducing tariffs across major product categories.

The agreement may help revive trade relations that have gradually weakened as the UK’s share in India’s merchandise trade declined since 2009, while supporting Indian exports in sectors such as electronics, chemicals, textiles, leather, marine products, engineering goods, processed food, pharmaceuticals, and gems and jewellery.

What Has Been Announced About the India-UK FTA?

India and the United Kingdom have confirmed July 15 as the implementation date for the free trade agreement.

The announcement came after Prime Minister Narendra Modi and UK Prime Minister Keir Starmer met on the sidelines of the G7 Summit. Businesses will get around 28 days to prepare before the agreement takes effect.

To claim tariff benefits under the agreement, businesses must register with the UK’s HM Revenue and Customs (HMRC).

Why Is the India-UK Trade Corridor in Focus?

The UK’s share in India’s merchandise trade has declined over the years, even though trade between the two countries has continued in absolute terms.

In 2009, the UK accounted for 2.4% of India’s total merchandise trade. By 2025, this share had fallen to 2%.

India’s exports to the UK also slipped as a share of total exports, from 3.7% in 2009 to 3.1% in 2025.

This shows that the UK has become a smaller part of India’s global trade basket as India expanded ties with other markets.

How Has India’s Export Basket to the UK Changed?

India’s export basket to the UK has changed over the past decade.

Textiles were once the largest category, but machinery and electronics now lead Indian exports. Chemicals have also gained share, while transport equipment has declined.

This shift shows India’s export base moving toward more manufacturing-led categories.

Which Indian Exports May Benefit From Lower UK Tariffs?

The agreement is expected to provide zero-duty access to around 99% of exports.

This can make Indian goods more competitive in the UK market, especially in sectors where duties were previously high. Key categories that may benefit include electronics, textiles and apparel, chemicals, pharmaceuticals, leather and footwear, marine products, engineering goods, auto components, processed food, toys, gems and jewellery.

The biggest impact may be seen in labour-intensive sectors:

Lower duties can improve market access, reduce landed costs for UK buyers, and create more room for export growth in sectors where India already has manufacturing strength.

What About Steel Exports?

Steel was one of the issues being watched before the implementation of the India-UK trade deal.

The government clarified that 85% of India’s steel exports will remain outside the scope of Britain’s steel safeguard measures. This was addressed through country-specific quotas, residual quota allocations, and access under the Authorised Use Scheme.

What Will India Import From the UK Under Lower Duties?

India’s imports from the UK are concentrated in metals, machinery, and stone and glass products.

Other key UK exports to India include precious metals, electrical equipment, aerospace products, chemicals, medical devices, and Scotch whisky.

Under the agreement:

These changes may make select UK products more competitive in the Indian market.

Final Outlook: How Can the FTA Impact India-UK Trade?

The India-UK free trade agreement can support bilateral trade by improving market access for both countries.

For India, lower UK tariffs may support export growth in sectors such as electronics, textiles, leather, chemicals, engineering goods, processed food, and marine products.

For the UK, reduced duties in India may create opportunities in whisky, automobiles, aerospace, machinery, and medical devices.

India expects total bilateral trade with the UK to double from the current level to about $56 billion by 2030.