India and the UK have resumed discussions on a free trade agreement, nearly a year after negotiations were put on hold ahead of general elections in both nations.
Jonathan Reynolds, the UK’s business and trade secretary, met with his Indian counterpart, Piyush Goyal, in Delhi Monday, officially launching the two-day deliberations.
The discussions centered on “advancing” the negotiations and ensuring that the deal was “balanced, ambitious and mutually beneficial,” Goyal wrote on X.
Since 2022, both countries have engaged in over a dozen rounds of negotiations, yet a final agreement has remained elusive.
Among the primary sticking points are India’s steep tariffs on Scotch whisky and the UK’s visa regulations and fees for Indian students and professionals.
These negotiations mark the first under the newly elected Labour government, and Reynolds has emphasized that securing a trade agreement is a “top priority” for his administration.
“Growth will be the guiding principle in our trade negotiations with India and I’m excited about the opportunities on offer in this vibrant market,” he said in a statement ahead of the meeting.
India is projected to become the world’s third-largest economy in the coming years, adding further significance to the trade discussions.
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Following their talks, the ministers held a joint press conference but did not specify a timeline for concluding the agreement. Previous deadlines set by former UK leaders Boris Johnson and Liz Truss passed without a deal being reached.
For India, the trade discussions have taken on greater urgency following US President Donald Trump’s decision to introduce reciprocal or tit-for-tat tariffs on imports from various countries, including India.
The UK is also a key trading partner for Prime Minister Narendra Modi’s administration, which has set an ambitious target of increasing exports by $1 trillion by FY30.
The UK government had announced in November last year—shortly after Sir Keir Starmer met PM Modi at the G20 summit in Brazil—that talks would recommence in the new year.
Currently, trade between the two countries stands at £41bn ($52bn), according to a UK government statement. A trade agreement is expected to unlock significant opportunities for both economies.
London has identified sectors that could benefit from a deal, including advanced manufacturing, clean energy, and professional and trade services.
The agreement could also expand the market for British goods such as luxury cars, Scotch whisky, and financial services, generating billions in potential revenue.
Meanwhile, India is pushing for greater mobility for its professionals and students in the UK, along with faster visa processing times.
Additionally, it may seek exemptions for Indian workers on short-term business visas, who are currently required to pay national insurance but do not qualify for social benefits.
Speaking at the joint press briefing, Goyal clarified that immigration was not part of the discussions.
“India has never ever discussed immigration in any free trade negotiations,” he stated.
Reynolds reinforced this, adding that business mobility was a “separate issue” from immigration.
During his visit, Reynolds and Goyal will also tour the BT office in Gurugram, a major corporate hub in northern India.
UK Investment Minister Poppy Gustafsson is also in India, attending events in Mumbai and Bengaluru—two of the country’s largest business centers.
After years of caution regarding free trade agreements, India has actively been negotiating and finalizing deals with several nations and economic blocs.
Last year, the country signed a $100bn free trade pact with the European Free Trade Association—a group comprising four European nations that are not part of the European Union—following nearly 16 years of discussions.
India is also set to resume trade negotiations with the European Union this year.