India-UK Post-Brexit: New Opportunities in a Reconfigured Trade Relationship

India and the UK have a deep bilateral relationship rooted in shared history, the world largest Indian diaspora outside India at 1.8 million people, and complementary economic strengths. Brexit created both a complication — India-UK trade now negotiated separately from India-EU — and an opportunity — the UK can move faster and with different priorities than a 27-member EU bloc.

India-UK trade today: Bilateral trade was approximately USD 36 billion in FY2025. India top exports to UK: pharmaceuticals (USD 4.8 billion — largest category), precious metals and gems, machinery, transport equipment, textiles. UK top exports to India: aircraft and spacecraft, machinery, professional and scientific instruments, whisky and spirits, medical equipment.

The FTA negotiating positions: India wants: improved Mode 4 access for Indian IT and professional services workers, zero duty on Indian garments (currently 12% UK MFN) and footwear, recognition of Indian professional qualifications, and reduced tariff on Indian engineering goods. UK wants: significantly reduced tariff on Scotch whisky (currently 150% in India), reduced tariff on UK automotive exports, improved market access for UK financial services, and UK professional services firms in India.

The IT services opportunity: UK is India largest IT services export destination in Europe — Indian IT exports to UK are approximately USD 25 billion annually. The UK tech sector has a chronic shortage of skilled IT workers. The India-UK FTA Mode 4 chapter — simplified pathways for Indian IT professionals to work in the UK — could significantly expand this already substantial corridor.