Buoyed By UK FTA, India Looks To US, EU, Peru, Oman

With its robust middle class and increasing consumption, India serves as an attractive trade partner for most economies. “India is and will continue to negotiate from a position of strength. The trade pacts must be beneficial to both sides, unlike the ones signed earlier,” a senior government official said.

One of the highlights of the India-UK FTA is the inclusion of the Double Contribution Convention (DCC) deal or the social security pact, which exempts Indians working in the UK from paying social security in the UK for up to three years.

This has brought much cheer to India’s skilled talent. "This will increase the UK's ability to attract skilled talent from India," said professional services firm Grant Thornton Bharat in a note.

But back home, many have raised questions about the issue, even though the UK has such agreements with countries like the US, Canada and Japan.

“The reduction of trade barriers with the UK will strengthen the competitiveness of Indian exports, enabling broader market access while supporting key sectors like agriculture and MSMEs,” said Pallavi Bakhru, partner and UK corridor leader at Grant Thornton Bharat, adding that the pact is especially noteworthy due to its timing. It has been inked at a critical juncture, offering timely value amid global trade realignments and uncertainty around US tariff policies, the firm announced.

Economic and trade cooperation between India and the UK has grown significantly in the last few years.

“What we need to understand is that the traditional template for a bilateral trade pact is now broken, and this is an important move. In the India-UK pact, the non-trade-related issues have been skirted. For future deals too, we need to stick to this new format,” Ashwani Mahajan, national co-convener of Swadeshi Jagaran Manch (SJM) told The Secretariat.

He added that issues falling under the TRIPS (Trade-Related Aspects of Intellectual Property Rights) bracket, such as intellectual property and knowledge exchange, have not found any major focus in the FTA.

In 2023, Indians became the largest group of immigrants to the UK, largely due to increased work visas in healthcare, although future immigration policies may impact these trends, the Grant Thornton Bharat report also said.

It added that India-UK collaborations driven by initiatives under India's National Education Policy (NEP) 2020 have enabled the University of Southampton to set up a campus in Gurugram, which is expected to open by July 2025. 

Trade Pact With The US Next?

Talks between India and the US are also on a fast track, with expectations of an announcement soon. “All indications are that some kind of deal will be struck very soon,” said a source who is familiar with the negotiations, adding that both India and the US have agreed to move ahead on common grounds.

Commerce and Industries Minister Piyush Goyal, speaking at the 10th CII India-LAC Conclave, said that trade talks with Peru have been ongoing for a prolonged period, and that this has to be corrected. “The government is now moving with specific deadlines in mind… Though these are not sacrosanct, the fact is that talks cannot go on endlessly,” a source said.

Negotiations on a bilateral trade pact with the EU have gone on for more than a decade. The India-EU deal is likely to be concluded by the year-end.