Strengthening the Commercial Bond between the UK and India
The India-UK Free Trade Agreement, signed on July 24, 2025, at Chequers Estate, marks a significant milestone in the relationship between the two nations. This comprehensive deal is designed to drive job creation, ease skilled labour mobility, reduce trade barriers, and expand markets, benefitting both economies in employment growth and trade opportunities.
Impact and Benefits on Employment
The agreement is projected to create thousands of new jobs in the UK, with the government estimating over 2,200 new jobs supported directly by increased trade and investment, while boosting the UK’s GDP by approximately £4.8 billion ($6.5 billion) annually and providing a £2.2 billion ($3 billion) wage boost each year. In India, the deal will boost job opportunities especially in labor-intensive sectors like textiles, handicrafts, food processing, leather goods, and toys—sectors that generate millions of jobs.
The agreement also facilitates the temporary movement of skilled professionals between the two countries, covering 35 sectors and allowing Indian professionals (including contractual workers, business visitors, investors, and certain independent professionals) to work in the UK for up to two years even without a UK office. Special concessions such as waiver of UK social security contributions for Indian employees for up to three years enhance the financial viability of such mobility, benefiting an estimated 75,000 Indian workers and their employers.
Moreover, the agreement aims to strengthen women’s participation in sectors like handlooms, heritage crafts, technology, and sustainable manufacturing by providing better integration into global supply chains and support for entrepreneurship, potentially expanding employment opportunities for women.
Impact on Industrial Action
The FTA emphasizes streamlining workforce deployment and reducing barriers related to social security and visa regulations, which can reduce friction and industrial disputes arising from employment and labor mobility issues. The waiver of social security contributions and formalized mobility provisions are likely to alleviate some regulatory burdens that otherwise might lead to tensions or industrial action, especially in service sectors.
While explicit details on industrial action (e.g., strikes or union disputes) are not specified in the sources, smoother labor mobility and clearer regulations typically reduce uncertainty and conflict potential across industries, creating more stable labor relations.
Impact on Market Expansion
The agreement targets an annual bilateral trade boost of $34 billion, opening new export avenues for both countries, especially for India in labor-intensive and MSME-driven sectors such as textiles, handicrafts, and food processing.
UK consumers will benefit from tariff reductions on goods like whisky, cars, and electric vehicles, and a wider product variety at lower costs in sectors such as clothing, footwear, and food.
Indian companies gain improved access to the UK market with easier workforce mobility and cost efficiencies, attracting up to £6 billion in new UK investment and export opportunities. The deal supports service sector growth, particularly for India in IT, consulting, finance, and creative industries, enabling freer flow of talent and business across borders.
Summary Table of Key Benefits
| Aspect | India | UK | |----------------------------|---------------------------------------------------|-----------------------------------------------------| | Employment | Expansion in MSMEs, labor-intensive sectors; skill development in IT/services; better mobility for 75,000 workers | Creation of over 2,200 new jobs; wage boost of £2.2bn annually | | Industrial Action | Reduced regulatory friction through social security waivers and streamlined visas | Stable labor relations via clearer workforce rules | | Market Expansion | Access to UK market, export growth worth $34bn; enhanced service sector mobility | Tariff cuts on UK goods; £6bn investment influx; broader consumer choices |
Overall, the India-UK Free Trade Agreement is a transformational deal designed to drive job creation, ease skilled labor mobility, reduce trade barriers, and expand markets, benefitting both economies in employment growth and trade opportunities.
It is important to note that the acquisition of G4S Secure Solutions (India) Pvt. Ltd. by a US organization is an independent event from the India-UK Free Trade Agreement. Similarly, the agreement did not directly cause the acquisition, nor is it expected to lead to any significant changes in the tax liabilities of Jaguar Landrover Automotive PLC in the UK. Additionally, the agreement is not expected to influence the operations of Jaguar Landrover Automotive PLC in India or affect the employment situation at the company.
The benefits of the agreement are expected to extend to desi companies with operations in the UK, opening new opportunities for growth and expansion. As both countries continue to navigate the complexities of the global economy, the India-UK Free Trade Agreement serves as a beacon of hope for increased cooperation, mutual growth, and shared prosperity.
- The India-UK Free Trade Agreement, projected to generate 2,200 new jobs in the UK and boost its GDP, will also expand job opportunities in labor-intensive sectors in India, particularly in textiles, handicrafts, food processing, leather goods, and toys.
- The agreement facilitates the temporary movement of skilled professionals between the two countries, with Indian professionals in 35 sectors able to work in the UK for up to two years without a UK office, and with UK companies gaining better access to the Indian market in IT, consulting, finance, and creative industries.
- By streamlining workforce deployment and reducing barriers related to social security and visa regulations, the agreement aims to strengthen women’s participation in sectors like handlooms, heritage crafts, technology, and sustainable manufacturing, potentially expanding employment opportunities for women.
- The deal targets an annual bilateral trade boost of $34 billion, opening new export avenues for both countries in labor-intensive and MSME-driven sectors such as textiles, handicrafts, and food processing. UK consumers are expected to benefit from tariff reductions on goods like whisky, cars, and electric vehicles, and a wider product variety at lower costs in sectors such as clothing, footwear, and food.
- The benefits of the agreement are not limited to direct employment but extend to desi companies with operations in the UK, opening new opportunities for growth and expansion. The agreement serves as a beacon of hope for increased cooperation, mutual growth, and shared prosperity between the two nations.
