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UK-India Trade Deal Takes Effect

  • Writer: Advantage Worldwide
    Advantage Worldwide
  • 2 days ago
  • 2 min read

The UK-India Free Trade Agreement has officially entered into force, opening up new opportunities for businesses trading between the two countries.


The deal was signed on 24 July 2025 and came into effect on 15 July 2026. It’s designed to reduce tariffs, simplify customs procedures and make it easier for businesses to move goods and services between the UK and India.



India has historically had some of the highest average tariffs of any G20 economy, with duties on certain products exceeding 100%. Under the new agreement, India will remove or reduce tariffs on 90% of tariff lines, covering 92% of existing goods imports from the UK. The UK will also eliminate tariffs on 99% of goods imported from India.


India will remove or reduce tariffs on 90% of tariff lines

What traders need to know:

  1. 64% of tariff lines became eligible for tariff-free entry into India when the deal took effect.

  2. After a 10-year transition, 85% of tariff lines will be eligible for tariff-free entry.

  3. UK exporters are expected to save around £400 million a year on tariffs initially, rising to approximately £900 million after 10 years.

  4. Customs procedures should become simpler, with greater use of electronic documentation and reduced administrative requirements.

  5. Both countries have agreed to aim to release goods within 48 hours of arrival at customs, where requirements have been met and no physical examination is needed.


The agreement covers a wide range of sectors, including advanced manufacturing, automotive, food and drink, medical technology and consumer goods. It also includes rules of origin that businesses will need to meet to benefit from preferential tariff rates.


The UK Government estimates that the agreement could increase bilateral trade by £25.5 billion a year in the long term. For importers and exporters, the immediate opportunity is to review existing supply chains and check whether goods now qualify for reduced or zero tariffs.


If you’re trading between the UK and India and want to understand what the new agreement could mean for your shipments, speak to your local Advantage Worldwide office for further guidance.

 

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