With an aim to deepen economic ties and strengthen bilateral trade, the free trade agreement between India and the UK will formally enter into force on July 15, 2026, after resolving a steel issue. The move is likely to help double two-way commerce to $100 billion by 2030. The two countries will also implement the Agreement on Social Security or the Double Contribution Convention (DCC) on the same day. Under DCC, Indian companies operating in the UK would not have to make social security contributions for up to five years for employees they move from India to support their operations. The commerce ministry said the period of exemption under DCC has been increased from 3 years to 5 years, thereby marking a major gain for India’s temporary workers. It said that following the successful completion of internal procedures and ratifications by both governments, the agreements will formally enter into force on July 15, 2026.
Commerce and industry Minister Piyush Goyal said that the simultaneous enforcement of the Comprehensive Economic and Trade Agreement (CETA) and the DCC on July 15 will open up significant new opportunities for India’s exports. The trade pact will see 99 per cent of Indian exports enter the UK duty-free, while reducing tariffs on British products such as cars and whisky. He added that stringent exclusion lists are actively deployed to insulate sensitive agricultural and rural economies from import volatility. He added ‘Simultaneously, by exempting our professionals from double insurance contributions, we are protecting the financial interests of our talent pool. This dual breakthrough aggressively expands our global commercial footprint while fiercely guarding domestic sensitivities’. The minister is likely to visit London later this month (tentatively June 25-27).
After signing the deal, Britain’s steel safeguard measure became a sticking point in implementing the agreement. The two countries have successfully reached a landmark consensus to safeguard and promote bilateral steel trade. Under the pact, Indian exporters will benefit from the complete elimination of UK tariffs across several key sectors. Tariffs of up to 70 per cent on processed food products, up to 21.5 per cent on marine products, up to 18 per cent on engineering goods and auto components, up to 16 per cent on leather and footwear products, up to 12 per cent on textiles and clothing, and up to 8 per cent on chemicals and pharmaceutical products will be reduced to zero.
The immediate duty-free access secured under CETA is expected to significantly enhance the competitiveness of Indian exports in the UK market, generate new opportunities for farmers, fishermen, workers, MSMEs and manufacturers, and strengthen India’s integration into global value chains. The UK has provided one of its most comprehensive services commitments ever, covering all major services sectors and 137 sub-sectors of export interest to India. Indian service providers in IT and IT-enabled services, financial services, professional services, healthcare, education, engineering, telecommunications and consultancy services will benefit from enhanced market access and greater regulatory certainty.
Besides, two-way commerce between India and the UK grew 8.62 per cent to $25.12 billion (exports: $13.44 billion; imports: $11.68 billion) in 2025-26, up from $23.13 billion in 2024-25. India reported a trade surplus of $1.76 billion in the last fiscal. The UK is the sixth largest investor in India. Britain’s foreign direct investment in India has increased to $1 billion in 2025-26, up from $795 million. Following fourteen intensive rounds of talks and discussions, negotiations for the CETA were concluded on May 6, 2025. The agreement was officially signed on July 24, 2025 in London.
