UK-India Trade Deal: A Strategic Shift Toward Growth

The newly announced UK-India trade agreement marks a pivotal moment in the evolving relationship between two of the world’s most dynamic economies. As Head of International at Irwin Mitchell, I welcome this development as a clear signal of the UK’s intent to prioritise high-growth markets and deepen its global trade footprint.

The agreement, which covers key sectors such as aerospace, medical devices, cosmetics, electrical machinery, and food and beverage, is expected to boost bilateral trade by over £25 billion annually by 2040. For UK exporters, the reduction in tariffs on products like whisky, gin, and premium food items is a particularly welcome move. Indian exporters, in turn, will benefit from lower duties on textiles, footwear, jewellery, and seafood—sectors that are vital to India’s export economy.

This deal arguably follows a notable shift in the UK’s international trade strategy. Earlier this year, we highlighted the Department for Business & Trade’s decision—under the Labour Government—to prioritise India over the US for its first major overseas trade mission. That move, led by Business and Trade Secretary Jonathan Reynolds and Investment Minister Poppy Gustafsson, underscored a growing recognition that the UK must look beyond traditional partners and engage more deeply with fast-growing economies like India.

The visit to India, which included meetings in New Delhi, Mumbai, and Bengaluru, was not just symbolic—it reflected a broader policy pivot. A recent Freedom of Information request revealed that since taking office in October 2024, Minister Gustafsson had not yet visited the US, nor were any meetings with US-headquartered businesses scheduled. This suggests a deliberate and strategic rebalancing of the UK’s global trade priorities. Indeed, my colleague Richard Baigent posted in early April: “Whilst the US is the world’s largest consumer market, the opportunity to consider how future trade relations with other countries and regions around the world has never been more important. Diversification of trading partners through an increased effort around securing Free Trade Agreements will have moved up the ‘to do list’ not just for the UK, but perhaps also for India as an example?”

From a business perspective, this agreement simplifies trade, reduces barriers, and creates a more predictable environment for investment. At Irwin Mitchell, our Head of India Desk Akil Sharma is already seeing increased interest from clients looking to explore opportunities in India or expand their existing footprint. This deal will only accelerate that momentum.

That said, it’s important to acknowledge one missed opportunity: the absence of provisions for legal services—something which The Law Society have championed. While not central to the agreement, legal services are a vital enabler of international trade and investment. Greater legal market access would have supported smoother cross-border transactions and provided valuable opportunities for collaboration between UK and Indian legal professionals.

It’s also important to recognise that this trade deal is a starting point, not a finished product. As the UK-India relationship continues to evolve, there will undoubtedly be areas that require further negotiation, refinement, and collaboration. 

This trade deal is a strong foundation—and we look forward to helping our clients build on it.

India was recognised as the second largest provider of FDI into the UK in Irwin Mitchell's latest FDI report.

You can hear more about how the UK is attracting FDI in the new season of our Business But Better podcast. We’re joined by industry experts to explore the unique advantages available to overseas investors, how the government is prioritising FDI, and the help available when entering the UK market.