What happened?
Prime Minister Narendra Modi and United Kingdom Prime Minister Keir Starmer held a telephone conversation on May 6, 2025, during which they welcomed the successful conclusion of negotiations for an ambitious India-UK Free Trade Agreement (FTA) and an accompanying Double Contribution Convention. Both leaders characterised these agreements as a significant historic milestone within the framework of the bilateral Comprehensive Strategic Partnership. They emphasised that the FTA and the Convention are designed to foster increased trade and investment, stimulate innovation and job creation, and promote greater mobility between the two nations. During the call, Prime Minister Starmer noted that strengthening alliances and reducing trade barriers are part of the UK’s broader economic plans. Prime Minister Modi has extended an invitation to Prime Minister Starmer to visit India. (Information sourced from PIB Delhi)
Why it matters to India
The conclusion of the Free Trade Agreement with the United Kingdom is a landmark achievement for India, significantly advancing its strategy to deepen economic engagement with key global partners and expand its international trade horizons. This comprehensive FTA, which encompasses trade in goods and services, is poised to substantially boost bilateral trade between India and the UK. This is expected to create extensive new avenues for Indian businesses, enhance market access for Indian products and services, and attract further investment into India. The agreement is anticipated to generate significant employment within India, contribute to raising living standards, and improve the overall economic well-being of Indian citizens. Furthermore, the FTA will unlock new potential for India and the UK to jointly develop innovative products and services for global markets, thereby strengthening India’s manufacturing and service sectors. The successful negotiation also cements the strong foundations of the India-UK Comprehensive Strategic Partnership, paving the way for a new era of enhanced collaboration, deeper people-to-people ties, and shared prosperity focused on India’s growth and its role in the global economy. The accompanying Double Contribution Convention is also expected to streamline financial and social security aspects for Indians working in or engaging economically with the UK.