India-UK FTA opens new roads for Automotive growth

After nearly three years of intense negotiations, India and the United Kingdom (UK) have officially signed a landmark Free Trade Agreement (FTA) on May 6, 2025. This milestone deal between the world’s fifth and sixth largest economies arrives at a time when global trade is facing volatility, offering a renewed sense of optimism and opportunity, especially for India’s automotive sector.India’s Prime Minister, Narendra Modi, in a post on X, called it an “ambitious and mutually beneficial Free Trade Agreement that will catalyze trade, investment, growth, job creation, and innovation” in both economies. His UK counterpart, Prime Minister, Keir Starmer, is expected to visit India soon to further the new trade relationship.The agreement is expected to boost bilateral trade by £25.5 billion annually by 2040, according to the U.K. government. In 2024, total trade between India and the UK stood at £42.6 billion, with India exporting £25.5 billion worth of goods to the U.K. and importing £17.1 billion in return.For India, the agreement marks a key step in expanding its global trade footprint. This deal includes tariff reductions across key industries like automobiles, aerospace, medical devices, electrical machinery, cosmetics, and even food products. India currently has 14 FTAs with predominantly South