Britain and India solidified their economic partnership Thursday with a landmark free trade agreement signed during Prime Minister Narendra Modi's visit to Chequers, the British prime minister's official country residence. The deal marks a strategic shift in post-Brexit trade relations and could reshape Asia-Europe commerce patterns.
Key provisions include:
India slashing average tariffs on British goods from 15% to 3%
Alcohol tariffs reduced from 150% to 75% immediately, falling to 40% within 10 years
UK automotive import duties dropping from over 100% to 10% under quota system
99% of Indian exports to Britain gaining tariff-free access
The British government projects the agreement will create 2,200 jobs and deliver £2.2 billion in annual wage increases for workers. Consumers could see price reductions on clothing, footwear, and food imports from India.
Long-term projections suggest a 39% increase in bilateral trade by 2040 compared to no-deal scenarios, equivalent to £25.5 billion annually. Sectors like aerospace, renewable energy technology, and advanced manufacturing are expected to benefit most.
This agreement follows months of negotiations since the initial May announcement, with both leaders emphasizing its role in strengthening democratic economic partnerships amid global supply chain realignments.
