A few years ago, I sat in a boardroom in Mumbai where a textile exporter told me he had nearly given up on the UK market. “The duties were killing us,” he said, shaking his head. “We had great demand but zero margins.” Fast forward to today, and that same exporter just called to say his latest shipment cleared customs with zero duty. That’s the power of a trade agreement done right.

On May 6, 2025, India and the UK signed what’s being called one of the most ambitious trade agreements between the two countries. It didn’t come easy. There were 14 rounds of negotiations, moments where it felt like the whole thing might fall apart, and a lot of backchannel diplomacy to finally get it across the line.

But now it’s real. And it’s already reshaping how businesses on both sides are planning their next moves.

Tariffs Are Falling, and Confidence Is Rising

The biggest headline from the agreement is simple: tariffs are coming down. For UK exporters, that means more than 90 percent of their goods are entering India with lower duties. British whisky makers, in particular, are thrilled—India is their largest market by volume, but high import taxes had always held them back. Now those duties are being slashed from 150 percent to 40 percent over the next decade.

On the other side, 99 percent of Indian exports to the UK—textiles, auto parts, jewelry, you name it—are now duty-free. For Indian garment manufacturers, this is a long-awaited green light to grow their presence in British retail stores.

This Isn’t Just About Goods

What stood out to me was the way this trade agreement also opens up pathways for professionals. For years, Indian companies have struggled with sending staff to UK offices because of overlapping social security payments. That’s now been eased. Indian professionals on short-term assignments won’t need to pay UK national insurance for up to three years.

This is a quiet change, but one that’ll make a big difference. I’ve seen HR teams struggle to budget for these overseas postings—this will take a big weight off their shoulders.

Real Economic Gains? Signs Point to Yes

I don’t usually trust economic forecasts blindly, but the numbers coming from this agreement are hard to ignore. UK officials say the deal could bring in over £4.8 billion a year to their economy by 2040. On India’s side, it plays right into the broader plan to double exports and become a global manufacturing hub.

Every time I talk to exporters now, there’s a shift in tone. Less frustration, more focus. Less waiting around, more action.

The Benefits Are Clear—But So Are the Challenges

Of course, not everyone’s celebrating. UK pharmaceutical companies were hoping for stronger IP protections and didn’t get them. And some British labor groups are concerned about competition from lower-cost Indian professionals.

But every major agreement has its trade-offs. What matters more is whether both sides feel like they’ve gained something real—and right now, that seems to be the case.

Final Thoughts

This trade agreement didn’t just cut tariffs. It cracked open the door to a more balanced partnership between India and the UK. I’ve seen a lot of deals over the years, and most of them promise more than they deliver. But this one? This one feels different.

Because behind the spreadsheets and legal text are real people. Business owners breathing easier. Workers landing new opportunities. And long-stalled dreams finally inching forward.

If you’re doing business between these two countries, this is your moment to move. Looking for a reliable woven fabric manufacturer, please contact us.

Read more about India – UK FTA on BBC.