A good innings? The biggest winners in the UK-India trade deal

LONDON — Much like cricket, trade talks with India have been a long game, with plenty of sticky wickets along the way.

As India’s cricket team goes head-to-head with England at Old Trafford on Thursday, Prime Minister Keir Starmer and his Indian counterpart Narendra Modi flaunted their newly inked free trade agreement at Chequers, Starmer’s country residence. The parallel did not go unnoticed by the two leaders.

“For both of us cricket is not just a game but a passion — and also a great metaphor for our partnership,” Modi told reporters shortly after the deal was signed. “There may be a swing and a miss at times, but we always play with a straight bat. We are committed to building a high-scoring, solid partnership.”

The ceremony marked the symbolic end to three years of sometimes fraught head-to-head negotiations between India and Britain’s trade teams.

While far from what British negotiators envisaged when they began the talks, the U.K. has managed to chalk up a fair few wins, with some stand-out sectors emerging triumphant. Indian negotiators can also boast of a few victories.

From Scotch whisky to business mobility, we’ve set out the biggest wins on either side in our FTA scoreboard.

UK winners

Scotch whisky producers

One of the biggest wins on the U.K. side is reduced tariffs for Scotch whisky. Under the FTA, Indian tariffs on the tipple will be slashed in half, from 150 percent to 75 percent, then dropped even further to 40 percent over the next decade. 

India is the world’s biggest whisky market by volume and the tariff reduction has been described as a “game changer” by the industry. Announcing the deal, Starmer said it would give U.K. whisky producers “an advantage over international competitors in reaching the Indian market.”

India is the world’s biggest whisky market by volume and the tariff reduction has been described as a “game changer” by the industry. | Neil Hall/EPA

“The deal will support long term investment and jobs in our distilleries in Speyside and our bottling plant at Kilmalid and help deliver growth in both Scotland and India over the next decade,” said Jean-Etienne Gourgues, CEO at Chivas Brothers. 

Automakers

There’s also good news for British automakers — which have had quite a ride over the past few months thanks to U.S. President Donald Trump’s punitive tariff regime. Tariffs of up to 110 percent on British cars will drop to 10 percent after five or ten years depending on the type of car. As a result, the government expects exports of U.K. motor vehicles to increase by 310 percent — or £890 million — in the long run. 

Mike Hawes, chief executive of the Society of Motor Manufacturers & Traders (SMMT), which represents the British automotive industry, said the deal represented a “significant achievement, partially liberalising the Indian automotive market for the first time.”  

He called for rapid ratification of the deal and renewed efforts to agree “fair and workable solutions” on the administration of the tariff rate quotas.

Lawyers

Just days after the deal was first struck on May 6, India’s legal regulator approved new rules permitting foreign legal firms and lawyers to practise there on a reciprocal basis. It was seen by the sector as a key win coming in parallel with the deal. 

The Bar Council of India first signaled the move in 2023, but received fierce opposition from domestic legal firms. “This is an important development for our two professions,” said Richard Atkinson, president of the U.K.’s Law Society at the time, although some strict conditions still apply. 

Services firms 

The deal’s financial services chapter is a first for India. New Delhi promises that Britain’s financial and business services firms can’t be treated differently to Indian companies. It guarantees India cannot impose limitations on investment or the number of British financial services firms that can operate in the country.

India’s penchant for data localization — meaning services firms like banks and consultancies need to set up servers in India if they’re processing Indian nationals’ info — isn’t addressed in the deal since the country’s parliament is still working through new data privacy and security laws. Yet there are provisions to allow further negotiations with the U.K. if India moves to liberalize the flow of data in the future.

Indian winners

Workers on secondment to the UK

One of the most contentious areas of the trade deal — and most sought after on the Indian side — are new provisions on business mobility. The U.K. has promised that an existing visa route for some temporary workers that’s not currently available to India — and capped at 1,800 people — will now be open to Indian employees (although the cap won’t be lifted).

Most controversially for some, the U.K. and India have separately agreed to negotiate a Double Contributions Convention, which means that neither Indian nor British workers will be required to pay national insurance contributions in both their home country and the one they are working in. Details of the agreement are still being ironed out but both sides have agreed to strike the deal in side letters.

In promotional material published alongside the deal, the U.K. government insists the measures will have no impact on immigration. “All visa routes that have been locked in through the agreement are only available for temporary stays, and none of the routes provide a path to permanent settlement,” it notes.

Farmers

The U.K. has agreed to remove tariffs on imports of Indian food, with the exception of sugar, milled rice, pork, chicken and eggs, which will continue to be subject to the current duties in place. In its impact assessment, the government notes that food imports will still have to comply with U.K. food and animal welfare standards.

The U.K. has agreed to remove tariffs on imports of Indian food, with the exception of sugar, milled rice, pork, chicken and eggs, which will continue to be subject to the current duties in place. | Farooq Khan/EPA

Meanwhile, campaigners welcomed the absence of any intellectual property clause in the agreement that would have limited Indian farmers’ ability to save and exchange their seeds. 
Patented, genetically modified seeds and restrictions on their use have been identified as a one of several factors contributing to the high level of farmer suicides in the country.

“We hope that following this deal, the U.K. government will commit to safeguarding farmers’ rights in all future trade agreements, as farmer seed systems are vital for smallholder farmers in India and in many other countries across the world,” said Hannah Conway, trade and agriculture policy adviser at Transform Trade.

Drugmakers

Under the deal, Indian generic medicines and medical devices can be exported duty free to the U.K., in a move welcomed by the country’s officials. Last year the U.K. imported medicinal and pharmaceutical products worth around £667.4 million from India.

“Given the U.K.’s shift away from reliance on Chinese imports post-Brexit and Covid-19, Indian manufacturers are poised to emerge as a favoured, cost-effective alternative, especially with zero-duty pricing for medical devices,” a commerce ministry official told the Indian news agency PTI.

Meanwhile, India will also welcome the absence of any data exclusivity clauses related to pharmaceuticals in the deal’s intellectual property chapter, which could have posed a threat to the country’s generic drugs sector, the world’s largest by volume.

Textiles manufacturers

The trade deal removes tariffs on Indian textiles exported to the U.K., with imports expected to rise by around 85 percent to £2.9 billion, according to the government’s impact assessment. The U.K. imported Indian clothing worth £877.3 million last year.

As a result, the government projects that the U.K. textiles, apparel and leather goods industry is expected to lose £114 million — the biggest projected decline of any industry. “This in turn is projected to lead to resources shifting away from adversely affected sectors to other sectors that exhibit a larger increase in exports,” it said.