Having signed 13 free trade agreements (FTAs) and six preferential trade pacts to boost exports, India has resumed negotiations with the UK for a comprehensive FTA. This comes after an eight-month gap, with Piyush Goyal, Commerce and Industry Minister and Jonathan Reynolds, UK Secretary of State, announcing the resumption of talks.

Negotiations, which began in January 2022, have completed 14 rounds. The FTA aims to boost trade and investment by reducing tariffs and non-tariff barriers, and to expand cooperation in technology, healthcare, and education.

In FY 2024, India's merchandise exports to the UK reached $12.9 billion. According to GTRI, the FTA's impact on increasing these exports may be limited, as over half of Indian goods already enter the UK with low or no tariffs. The UK's average tariff on Indian imports is 4.2 per cent. However, Indian exports worth $6.1 billion, including textiles, apparel, footwear, cars, and agricultural products, will benefit from duty reductions.

On the import side, India's merchandise imports from the UK stood at $8.4 billion in FY24. Approximately 91 per cent of these goods, worth $7.6 billion, face medium to high tariffs in India The UK seeks tariff reductions for these products.

With negotiations resumed, both countries aim to finalize an agreement that benefits trade and investment. The outcome will shape the future of India-UK economic relations.