UK–India Trade Deal: Ambition of Doubling Bilateral Trade to $120 Billion by 2030 — Can It Be Done?

Introduction: A Defining Trade Partnership in the Post-Brexit Era

The United Kingdom and India have long shared deep economic, cultural, and historical ties. But the push to redefine that relationship in modern, strategic, and trade terms has accelerated dramatically since Brexit. On October 8, 2025, UK Prime Minister Keir Starmer visited India to strengthen bilateral trade relations and advance talks on the long-awaited Free Trade Agreement (FTA) between the two countries. The visit marked a significant step in the UK’s efforts to deepen its economic ties with India post-Brexit, with both nations aiming to double their trade to $120 billion in the coming years. 

With the UK seeking dynamic new markets outside the European Union and India aspiring to become a global manufacturing and services powerhouse, both nations view their economic partnership as pivotal to long-term growth. According to the United Kingdom Import data, the total value of UK imports from India reached $15.32 billion in 2024 and $7.65 billion in the first two quarters of 2025. The total value of the UK exports to India accounted for $8.72 billion in 2024 and $4.35 billion in the first two quarters of 2025, as per the United Kingdom Export data. 

As per the latest global trade data, the UK-India trade reached $24.04 billion in goods trade in 2024 and $12 billion in H1 2025. In 2025, the two nations finalized a comprehensive Free Trade Agreement (FTA), the first such deal between the UK and one of the world’s largest emerging economies. The agreement aims to unlock trade opportunities worth tens of billions, expand investment flows, and position the UK–India corridor as one of the most dynamic economic relationships in the world.

At the core of this collaboration lies a bold ambition: to double bilateral trade to $120 billion by 2030. It’s a vision that captures headlines, but can it really be done? Let’s examine the India-UK trade data, the opportunities, and the barriers that stand between aspiration and reality.

The Baseline: Where UK–India Trade Stands Today

Before we assess what doubling means, we must first understand what the base looks like and where trade currently stands.

As of 2024–25, total bilateral trade in goods and services between the UK and India stands at around $56 billion, based on government and trade body estimates. That figure includes:

• Goods trade: Roughly $23 billion

• Services trade: Around $33 billion

Breaking that down further:

• India’s exports to the UK (mainly goods like textiles, gems, pharmaceuticals, and machinery) account for approximately $14.5 billion.

• The UK’s exports to India (including automobiles, spirits, industrial machinery, and professional services) are valued at about $8.5 billion.

Trade between the two nations has grown modestly over the past five years, averaging 7–9% annual growth, but the FTA aims to more than double that pace.

The UK-India FTA: Key Provisions and What’s New

The 2025 UK–India FTA is one of the most comprehensive trade arrangements either country has entered into in recent years. It covers not just tariff reductions but also regulatory standards, investment facilitation, customs cooperation, and services liberalization.

Here are the key highlights:

1. Tariff Reductions

• India will gradually remove tariffs on about 90% of UK goods over a phased period.

• The UK will grant zero-duty access to approximately 99% of Indian goods exports immediately after implementation.

This is a transformative change. India has historically had some of the highest tariff rates among major economies, particularly in sectors like automobiles, beverages, and high-end consumer goods.

2. Sector-Specific Benefits

• Whisky and spirits: India currently levies duties of up to 150% on imported spirits. Under the FTA, these duties will reduce to about 75% initially and are expected to fall further to around 40% within a decade.

• Automobiles: UK car exports to India, particularly luxury and electric vehicles, will benefit from lower tariffs, in some cases dropping from 60% to 30% or 10% under quota arrangements.

• Pharmaceuticals and healthcare: Indian pharmaceutical exports gain simplified regulatory recognition in the UK, while British medical device manufacturers get easier access to the Indian market.

• Agriculture and food: India will gain preferential access for processed food, spices, and tea; UK exporters of cheese, processed meats, and high-end food items benefit from gradual tariff cuts.

3. Services and Mobility

Services trade, which already represents over half of bilateral trade value, is one of the biggest winners of the deal.
Key provisions include:

• Easier business visas for professionals, engineers, IT specialists, and researchers.

• Progress on mutual recognition of professional qualifications.

• Simplified rules for cross-border data flows (critical for digital services and IT exports).

• Commitments on regulatory transparency in banking, finance, insurance, and legal services.

4. Investment and Technology Collaboration

The India-UK Comprehensive Economic & Trade Agreement also promotes:

• Bilateral investment protection and dispute settlement mechanisms.

• Joint innovation and R&D programs in green technology, fintech, AI, and education.

• Investment facilitation platforms to encourage SMEs and startups to engage in bilateral ventures.

UK-India Trade in the Last 10 Years: Yearly India-UK Trade Data

The Math: What Doubling Bilateral Trade Actually Means

Now let’s translate the ambition of “doubling trade to $120 billion by 2030” into measurable targets. If bilateral trade is around $56 billion in 2025, reaching $120 billion in 2030 means achieving a compound annual growth rate (CAGR) of approximately 15.5% per year for five consecutive years.

To put this in perspective:

• The global average trade growth rate (goods + services) between major partners typically hovers around 5–8% annually.

• Even high-performing bilateral relationships rarely sustain more than 12–14% CAGR for extended periods.

So, the $120B goal is aggressive; it requires not just steady growth but accelerated, broad-based expansion across multiple sectors simultaneously.

Why the Target Might Be Achievable

There are several reasons why this ambitious goal may not be as far-fetched as it seems. Let’s break them down into structural and policy factors.

1. Complementary Economies

The UK and India have complementary economic strengths:

• The UK excels in high-value services such as finance, consulting, education, R&D, and advanced manufacturing.

• India dominates cost-competitive manufacturing and technology services, including IT, pharmaceuticals, and textiles.

This complementarity creates a natural fit; the UK needs the scale and efficiency of Indian production, while India benefits from UK technology, investment, and innovation know-how.

2. Expanding Middle-Class Demand in India

India’s consumer base is expected to reach 600 million middle-class citizens by 2030. As disposable income rises, demand for premium products, automobiles, spirits, high-end foods, education services, and technology will skyrocket. The UK is well-positioned to supply many of these.

3. Post-Brexit Market Diversification

Since leaving the European Union, the UK has aggressively pursued trade diversification. India, as the fifth-largest global economy and one of the fastest-growing, is central to that strategy. London is motivated to make this partnership work, both economically and politically.

4. High-Potential Service Exports

The services sector already contributes 60% of bilateral trade, and it’s poised for faster expansion.

• Indian IT and software exports to the UK have been growing at 12–15% annually.

• UK financial services, education, and legal services have strong potential to expand in India’s liberalizing markets.

If the FTA successfully addresses professional mobility and data flow barriers, services trade alone could cross $70 billion by 2030.

5. Government and Private-Sector Alignment

Both governments have placed the trade partnership at the top of their economic diplomacy agendas. Industry bodies, such as the Confederation of Indian Industry (CII) and the UK-India Business Council (UKIBC), have created joint task forces to identify bottlenecks and drive private-sector participation.

6. Investments in Logistics and Infrastructure

India’s massive infrastructure programs, such as the PM Gati Shakti plan and expansion of ports and logistics parks, aim to reduce trade costs by 10–15% over five years. This could make Indian exports more competitive in Europe and the UK.

Where the Risks Lie: Barriers That Could Slow Progress

Despite the optimism, sustaining 15% annual growth in trade for half a decade is no small feat. Several structural and policy hurdles could derail progress.

1. Implementation and Non-Tariff Barriers

FTAs often stumble not at the signing but at the implementation stage.

• Delays in customs modernization, certification, and digital infrastructure can erode potential benefits.

• Non-tariff barriers, like product standards, labeling rules, and sanitary or phytosanitary regulations, are difficult to harmonize quickly.

• Mutual recognition of standards, particularly for pharmaceuticals, food, and electronics, could take years.

2. Political and Protectionist Pressures

Domestic politics could interfere.

• UK manufacturers may resist further tariff cuts if local jobs appear threatened.

• Indian small-scale producers might oppose competition from cheaper or higher-quality British imports.

• Maintaining a delicate political balance will be key to preventing backlash.

3. Infrastructure Gaps in India

While India is investing heavily in logistics, bottlenecks remain:

• Port congestion and long customs clearance times.

• Inadequate cold chains and warehousing for agricultural exports.

• High freight costs and limited connectivity to Tier-2 and Tier-3 cities.

Unless these are fixed, the cost and reliability of exports will remain challenges.

4. Regulatory and Environmental Compliance

The UK’s Carbon Border Adjustment Mechanism (CBAM) and environmental regulations could penalize high-emission Indian exports like steel, cement, and aluminium. Compliance will require large capital investments in cleaner production, which many Indian SMEs cannot afford without support.

5. Global Economic Uncertainty

Trade doesn’t grow in isolation. Slower global GDP growth, energy price volatility, or geopolitical tensions could directly impact export demand. The 2020s have already seen unprecedented disruptions, pandemic shocks, supply-chain crises, and regional conflicts, any of which could recur.

6. Currency Volatility

Exchange-rate fluctuations can sharply affect trade competitiveness. If the Indian rupee depreciates too fast, imports from the UK become costlier; if the British pound strengthens, UK exports lose price competitiveness.

7. Skill and Visa Barriers in Services

For services trade to flourish, professionals must be able to move easily across borders. Despite progress, visa caps, qualification recognition, and data protection rules remain sensitive political issues. Slow progress here could cap the growth of the fastest-growing segment.

Sectoral Growth Outlook: Who Gains Most

Let’s examine which sectors are likely to drive the trade surge and how much each could contribute to the $120 billion goal.

Among these, IT, pharmaceuticals, financial services, and consumer goods are expected to be the most significant contributors to trade growth.

The Numbers Behind the Projection

To visualize the path to $120 billion, let’s project potential trade growth year by year, assuming sustained high performance.

This trajectory assumes favorable conditions, full FTA implementation, stable exchange rates, and minimal trade disruptions.

The Role of Investment and Supply Chains

Trade expansion cannot occur without robust investment flows. Bilateral foreign direct investment (FDI) between the UK and India currently totals about $45 billion, with the UK being one of India’s top foreign investors.

To meet the trade goals:

• UK investment in Indian manufacturing must rise in sectors like green tech, electric vehicles, and food processing.

• Indian investment in the UK, in IT, hospitality, and pharma, must continue growing, helping Indian firms expand market presence and distribution networks.

Efficient supply chain integration will also matter. A direct shipping corridor and digital customs interoperability can reduce trade costs by up to 10%, freeing billions in potential trade gains.

Strategic and Geopolitical Underpinnings

The trade deal is not just about economics; it’s a strategic play.
Both governments see this relationship as part of a larger geopolitical balancing act:

• The UK strengthens its foothold in the Indo-Pacific, aligning with its “Global Britain” strategy.

• India gains greater access to European markets, technology, and finance without overdependence on China or the US.

• Both nations reinforce their positions in global forums such as the G20 and the Commonwealth.

What Needs to Happen for the Goal to Be Met

Achieving $120 billion by 2030 requires precision execution and collaboration. Here’s what both sides must prioritize.

For India

1. Accelerate customs digitization and logistics reforms to cut export transaction costs.

2. Invest in green compliance and certification to meet UK environmental standards.

3. Facilitate SME integration into global value chains with better credit and export incentives.

4. Expand port and warehousing capacity to avoid bottlenecks as export volumes surge.

For the UK

1. Ease visa and professional mobility restrictions to expand services trade.

2. Provide transition assistance to domestic industries facing new competition.

3. Deepen financial and R&D collaboration with Indian companies, particularly in the climate and digital sectors.

4. Enhance marketing support for UK exporters entering India’s complex market landscape.

Jointly

1. Monitor FTA implementation through a bi-national trade council to resolve disputes quickly.

2. Develop common sustainability standards to avoid trade friction under green regulations.

3. Encourage business-to-business linkages through trade fairs, digital platforms, and co-investment vehicles.

Realistic Scenarios for UK-India Bilateral Trade: Three Paths to 2030

Reaching $120 billion is possible, but it will require the optimistic scenario to unfold almost perfectly.

Final Assessment on UK-India Bilateral Trade: Can It Be Done?

The goal of doubling UK–India trade to $120 billion by 2030 is bold, ambitious, and strategically vital with the UK-India free trade agreement. 

The deal is underpinned by real opportunities, tariff liberalization, services expansion, infrastructure improvements, and complementary economic strengths. Both nations share strong political will and the motivation to diversify trade portfolios in a volatile global economy.

However, success hinges on execution and resilience. Implementation delays, non-tariff barriers, environmental compliance costs, and geopolitical uncertainty could all reduce momentum. Achieving a 15% annual growth rate is feasible but demands consistency, coordination, and private-sector leadership. If both countries maintain policy focus, align regulations, and invest in their export ecosystems, $120 billion by 2030 is within reach, not guaranteed, but achievable.

If they falter, the partnership will still grow significantly, perhaps reaching $90–100 billion, still a remarkable leap for two economies writing the next chapter of global trade cooperation.

Conclusion and Final Verdict: The Road to 2030

The goal of doubling UK–India trade to $120 billion by 2030 is ambitious but achievable with the right execution. Both countries have clear incentives: the UK is diversifying post-Brexit, while India is expanding its global trade footprint. Their economies complement each other; Britain’s strengths in services, technology, and finance align naturally with India’s manufacturing capacity, skilled workforce, and growing consumer market.

Yet ambition alone won’t deliver results. The success of the FTA depends on how effectively both sides reduce non-tariff barriers, streamline customs, improve logistics, and enable professional mobility. Stronger investment links, green partnerships, and digital trade will be critical drivers of growth.

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