Trade negotiations between India and Oman successfully concluded, agreeing on terms for a new trade deal.
In the last five years, the most significant international trade agreement signed by India is the India-UK Free Trade Agreement (FTA), officially signed on July 24, 2025. This landmark agreement marks a pivotal step towards boosting bilateral trade and improving logistics between the two countries.
Status of Implementation:
The India-UK FTA is newly signed and is expected to significantly reduce tariffs on key export sectors such as textiles, clothing, leather, footwear, gems and jewellery, marine products, agricultural and processed foods, engineering goods, chemicals, and pharmaceuticals. The UK, on the other hand, benefits from tariff reductions in aerospace, automotive, and electrical machinery sectors. Trade is expected to increase by nearly 39% by 2040 compared to projected levels without the agreement.
Implementation of tariff cuts and regulatory alignment is expected to roll out soon following the signing, but exact dates for full operationalization are not specified yet. Related measures on cooperation in tackling crime and migration were also agreed upon concurrently.
Other noteworthy developments affecting India’s trade in this period:
Although not a signed trade agreement, the United States imposed a 25% tariff on Indian imports effective August 2025, impacting sectors like textiles, footwear, and gems and jewellery with additional duties up to 50%. This tariff escalation complicates trade relations with the US and leads India to pursue trade diversification efforts.
Current Negotiations:
India is actively negotiating or exploring trade agreements with other partners such as the EU and New Zealand, but these have not culminated in signed FTAs in the last five years as per current available records. Notably, India is also in talks for the India-EU FTA, the India-UAE Comprehensive Economic Partnership Agreement (CEPA), and the India-New Zealand FTA. Additionally, the India-European Free Trade Association (EFTA) Trade and Economic Partnership Agreement (TEPA) is expected to be implemented later this year, and India is negotiating the India-Sri Lanka Economic and Technology Cooperation Agreement.
Summary:
| Trade Agreement | Signed Date | Key Features | Status | |------------------------|-----------------|-------------------------------------------------|----------------------------| | India-UK FTA | July 24, 2025 | ~99% Indian exports duty-free; tariff cuts; cooperation on crime; expected boost in trade | Signed, initial implementation underway | | Other FTAs (EU, NZ etc) | Ongoing talks | Negotiations ongoing | Not signed yet | | US Tariffs on India | Aug 2025 (tariffs) | 25-50% tariffs on key export sectors | In effect, impacting exports|
Thus, the India-UK trade agreement is the principal international trade deal signed by India in the last five years, currently transitioning into its implementation phase, while India continues to manage tariff challenges from the US and pursue diversification via negotiations with other trade partners.
- The India-UK Free Trade Agreement (FTA), signed on July 24, 2025, is the most significant international trade agreement signed by India in the last five years.
- The agreement is expected to impact a variety of sectors, reducing tariffs on key export sectors such as textiles, clothing, gems and jewellery, and engineering goods in India, while benefiting the UK in aerospace, automotive, and electrical machinery sectors.
- While the India-UK FTA is currently in its transition phase, India is facing tariff challenges from the United States, particularly in sectors like textiles, footwear, and gems and jewellery due to a 25% tariff on Indian imports implemented by the US in August 2025.
- To address these challenges and diversify trade, India is actively negotiating trade agreements with the EU, New Zealand, UAE, EFTA, and Sri Lanka, pursuing various free trade agreements (FTAs) and cooperative agreements.
