The UK-India free trade agreement, a monumental accord aimed at strengthening bilateral trade ties, officially came into effect on 15 July 2026. The Comprehensive Economic and Trade Agreement (CETA), signed on 24 July 2025, is poised to catapult the economic relationship between the two nations forward, building on the £48 billion in total trade recorded in 2025.
The agreement's impact will be felt immediately, with a significant proportion of traded goods benefiting from reduced tariffs or complete elimination. Specifically, 99% of Indian goods entering the UK and 90% of UK goods entering India will either be duty-free or face lower tariffs. This tariff reduction is expected to have an instantaneously positive effect on consumers and businesses, making a wide range of products and services more accessible and affordable for households.
Across various sectors, industries such as automotive, manufacturing, consumer goods, creative industries, and medical technology are likely to reap significant benefits from the agreement. The UK's Department for International Trade has highlighted the expected advantages in these areas, underscoring the agreement's potential to drive growth and innovation.
Looking ahead, CETA is forecasted to increase bilateral trade by £25.5 billion annually. This anticipated boost would translate into a yearly increase of £5.1 billion for India's GDP and £4.8 billion for the UK's GDP. The agreement marks a significant milestone in the development of the UK-India economic partnership, aiming to foster deeper integration and cooperation.