 "Scotch whisky and more: What will get cheaper after India-UK free trade deal")
India and the UK have reached a landmark trade agreement that promises to boost bilateral trade, reduce tariffs and provide more affordable goods to consumers in both countries. The deal, hailed as a major achievement for both economies is set to lower Indian tariffs on a wide range of British products, benefiting both businesses and consumers.
Under the terms of the agreement , Indian tariffs will be slashed on 90% of tariff lines, with 85% of these eventually becoming fully tariff-free within a decade. Notably, whisky and gin, two iconic British exports will see their tariffs halved from 150% to 75%, before further reducing to 40% by the tenth year of the deal. Also, automotive tariffs will drop significantly from over 100% to just 10% under a quota system.
New India-UK 🇮🇳🇬🇧 trade agreement:
— Dhruva Jaishankar · ध्रुव जयशंकर (@d_jaishankar) May 6, 2025
- Reductions on 90% of tariff lines. 85% tariff-free within decade.
- Whisky, gin tariffs to half...auto tariffs cut from over 100% to 10% under a quota.
- India market access for clothes, footwear, and food productshttps://t.co/BviOrZmVov
The deal also promises lower tariffs on several other British goods including cosmetics, medical devices, aerospace products, lamb, salmon, electrical machinery, soft drinks, chocolates and biscuits. For UK consumers, this means cheaper prices on a variety of items, from clothes and footwear to frozen prawns, as the UK liberalizes tariffs on imported goods.
Indian Prime Minister Narendra Modi said on X that the deal was “ambitious and mutually beneficial.” British Prime Minister Keir Starmer called it a “landmark” that was “fantastic news for British business, British workers and British shoppers.”
Impact Shorts
More ShortsIndia’s Trade Ministry said 99% of Indian exports would face no import duty under the deal.
“This brings us closer to our goal of becoming a global economic powerhouse. It protects our core interests while opening doors to India’s greater participation in global value chains,” Trade Minister Piyush Goyal said.
Modi’s office said the agreement covered trade in both goods and services, and would “unlock new potential for the two nations to jointly develop products and services for global markets.”
Britain said the deal is expected to increase bilateral trade by 25.5 billion pounds ($34 billion) a year “in the long run.”
With more than 1.9 million people of Indian heritage living in the UK, the deal is also expected to strengthen the historic and vital partnership between the two democracies. For UK businesses and consumers, the agreement promises significant benefits, with reduced trade barriers and improved access to one of the world’s most promising markets.
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