The UK and India have announced a new free trade agreement (FTA), the most comprehensive bilateral trade deal the UK has secured since leaving the European Union.

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The agreement is expected to boost the UK’s GDP by £4.8 billion and increase bilateral trade by £25.5 billion in the long term. UK exports to India could rise by nearly 60%, while imports from India are forecast to increase by 25%. Real wages are projected to see a modest 0.2% uplift.

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For UK exporters, the deal represents substantial new opportunities, particularly in the food and drink, automotive, pharmaceutical, and aerospace sectors. Tariffs will be reduced or eliminated on 90% of UK goods, with phased reductions bringing whisky tariffs down from 150% to 40% over ten years, and automotive tariffs cut from over 100% to 10% under quotas. In return, UK consumers may benefit from lower prices on Indian imports, including textiles, food products, and electronics.

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Immigration 

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The FTA does not alter the UK’s visa system, but it does include provisions with immigration implications. A key feature is the exemption of Indian workers on intra-company transfers of up to three years from paying UK national insurance contributions. While reciprocal for UK workers in India, this provision is expected to incentivise more Indian secondments to the UK, potentially affecting labour market dynamics. Although this change does not increase the number of visas available, it reduces the cost for employers bringing staff to the UK. 

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Contact and Disclaimer

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Should you have any questions regarding the above information, or require assistance with your immigration or global mobility matters, please don’t hesitate to contact our legal team at Hudson McKenzie. You can reach us by email at londoninfo@hudsonmckenzie.com or by telephone at +44 (0) 20 3318 5794. For office locations, please visit our Our Offices page.

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The information provided in this blog is for general guidance only and does not constitute legal advice.

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