LondonOn Thursday, the prime leaders of India and Britain signed a deal that will reduce tariffs on goods including Indian food and spices supplied to the United Kingdom and Scotch whisky and English gin shipped to India.
The deal was formally signed by Jonathan Reynolds and Piyush Goyal, the trade ministers of the United Kingdom and India, at Chequers, the British leader’s official country home outside of London.
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“The biggest and most economically significant trade deal” that Britain has made since 2020, according to Starmer.
“It was a historic day in our bilateral relations,” Modi stated.
In addition to the agreement, the two nations promised to cooperate more in areas like military, migration, climate change, and health and announced over 6 billion pounds ($8 billion) in trade and investment agreements in sectors including artificial intelligence, aircraft, and dairy products.
More than three years after talks began and languished under Britain’s previous Conservative government, the trade agreement between India and Britain—the fifth and sixth largest economies in the world—was unveiled in May.
The British Parliament still needs to ratify it.
The agreement will lower India’s average tax on British exports from 15% to 3%, according to the U.K. government. By the tenth year of the agreement, whisky and gin import duties will have been cut in half, from 150% to 75%, and then to 40%. Under a quota, auto tariffs will drop from above 100% to 10%.
According to Britain, the agreement is anticipated to boost bilateral commerce by 25.5 billion pounds ($35 billion) annually starting in 2040 and boost the British economy by over 5 billion pounds ($6.8 billion) annually.
In May, India’s Trade Ministry announced that the agreement would exclude 99% of Indian exports, including food, clothing, and footwear, from import duties.
After Britain left the EU, the then-prime minister proclaimed this as a major objective, and formal negotiations on it started in 2022. In October of that year, Johnson famously pledged to complete a deal by the Diwali holiday.
After 13 rounds of fruitless negotiations, the two nations halted their talks until they conducted general elections in 2024.
Britain replaced the Conservative administration with one led by Modi.
India, where Britain was the colonial power until independence in 1947, is the ancestry of about 2 million people in the United Kingdom.
“We want to strengthen our relationship further, so that it is even more ambitious, modern, and focused on the long term,” Starmer stated. “Britain and India have unique bonds of history, of family, and of culture.”
As India and England play each other, Modi laments that the game serves as a powerful metaphor for our relationship.
We always play with a straight bat, even though there can be some swings and misses, he remarked. Our goal is to establish a strong, high-scoring collaboration.
