The United Kingdom and India have agreed to a bilateral trade deal to lower tariffs on a range of products traded between the two countries, putting a period on three years of intense negotiations.
According to BBC News, tariffs from India against U.K. exports such as whisky and gin will initially be halved from 150% to 75%, before dipping to 40% within the next decade. Levies against U.K. exported vehicles will also be reduced from 100% to 10% over that same period, while India has already reduced 90% of tariffs on array of other British goods, with plans to have the majority of those products become tariff-free within 10 years. As part of the agreement, the U.K. will remove tariffs on 99% of imports from India, and Indian employees temporarily working in the U.K. will be exempted from paying national insurance for up to three years.
The U.K. government expects the trade deal — which was finalized on May 6 — to increase bilateral trade between the two countries by £25.5 billion ($34 billion). In 2024, goods and services traded between the U.K. and India totaled £42.6 billion. Speaking on social media, Indian Prime Minister Narendra Modi called the agreement "ambitious and mutually beneficial," while the U.K. praised it as the "biggest and most economically significant" bilateral trade deal the country has signed since it left the European Union.
This comes as the U.K. has sought similarly impactful trade deals with both the EU and United States, particularly as the latter has threatened wide-ranging tariffs in a bid to drive countries to the negotiating table. Talks between the EU and U.K. are expected to wrap up by the end of 2025, while U.S. Vice President J.D. Vance expressed optimism in a mid-April interview with British outlet UnHerd regarding a potential deal with the U.K.
Modi visited U.S. President Donald Trump in February, but so far no special trade deal has been negotiated between India and the U.S.
