New Era? Modi and Starmer Hail UK-India Trade Deal with Major Investment Boost

UK PM Keir Starmer and Indian PM Narendra Modi at the Global Fintech Fest in Mumbai. [Leon Neal/Pool/Reuters]

Mumbai - October 9, 2025 – In a landmark meeting amid the bustling backdrop of Mumbai's financial district, Indian Prime Minister Narendra Modi and British Prime Minister Keir Starmer celebrated the rapid implementation of the Comprehensive Economic and Trade Agreement (CETA) signed in July 2025, hailing it as a "breakthrough moment" that will turbocharge bilateral ties. Accompanied by a record-breaking delegation of over 125 UK business leaders, entrepreneurs, university vice-chancellors, and cultural figures, Starmer's two-day visit underscored the burgeoning partnership, with fresh announcements on investments, defence cooperation, and education exchanges poised to reshape economic landscapes on both sides.

The leaders' discussions at the Jio World Centre focused on operationalizing the trade deal, which slashes tariffs on key goods like textiles, whisky, cars, and cosmetics, while expanding market access for services in technology, finance, and professional sectors. Modi described the agreement as a "win-win" that would lower import costs, create youth employment opportunities, and boost trade volumes, benefiting industries and consumers alike. "With this Agreement, the import cost between the two countries will come down, new employment opportunities will be generated for the youth, trade will increase and this will benefit our industries and consumers," Modi stated during a joint address at the India-UK CEO Forum.

Starmer echoed the enthusiasm, calling the pact a "launchpad" for unprecedented growth. "The opportunities waiting to be seized under the India-UK Free Trade Agreement are unparalleled," he said, emphasizing India's trajectory to become the world's third-largest economy by 2028. Since the deal's signing, bilateral trade—currently valued at $56 billion (£42.6 billion)—has already seen a £6 billion boost in trade and investment flows. The agreement is projected to add £25.5 billion annually to bilateral trade by 2030, doubling current levels and positioning it as the UK's most economically significant post-Brexit deal and India's most comprehensive trade pact to date.

A highlight of the visit was the unveiling of £1.3 billion ($1.73 billion) in new commitments from 64 Indian companies expanding operations in the UK, spanning sectors from engineering and technology to creative industries and financial services. These investments are expected to create nearly 7,000 high-skilled jobs across the UK, from Basingstoke to Birmingham, reinforcing London's appeal as a global innovation hub. "In the three months since we signed that trade deal, we’ve seen a £6 billion boost in trade and investment—that’s on top of the increased numbers over the last year already," Starmer told assembled business leaders.

On the flip side, UK firms are eyeing Indian opportunities, with announcements like Wilson Power Solutions' £21 million investment in Chennai to quadruple transformer manufacturing capacity for clean energy projects. The UK-India Climate Finance Initiative was also launched, unlocking green growth funding and a new joint Climate Tech Start-up Fund.

Beyond trade, the duo signed a £350 million ($468 million) contract for the UK to supply lightweight missiles to the Indian Army, deepening defence ties under the India-UK Defence Industrial Roadmap. Modi highlighted enhanced maritime security cooperation in the Indo-Pacific, stating, "India and the UK are natural partners, and their growing ties stand as an important pillar of global stability and economic progress."

Education emerged as another cornerstone, with nine new British university campuses confirmed in India, including from the University of Lancaster and University of Surrey. This positions the UK as India's top international education provider, aligning with India's National Education Policy 2020 and the Programme of Cultural Cooperation. Additional pacts include a connectivity and innovation centre, a joint AI research facility, and Phase 2 of the UK-India Critical Minerals Supply Chain Observatory to diversify supply chains and spur investments.

While the mood was celebratory, underlying divergences surfaced. Starmer gently raised concerns over India's purchase of Russian oil amid the Ukraine conflict, joking about not sending birthday wishes to Vladimir Putin after Modi's recent gesture. "We discussed it and looked particularly at ways to end the Russia-Ukraine war, which is the outcome that we both want," Starmer noted. Notably absent from the deal: any visa concessions for Indian professionals, a sticking point in past negotiations. Starmer affirmed, "Britain will not pursue a visa deal with India," prioritizing economic gains over mobility.

The visit builds on the 'India-UK Vision 2035,' a 10-year roadmap for collaboration in trade, defence, climate, and people-to-people ties. As Modi put it, "Your visit to India within just a few months of signing the Agreement, with the biggest business delegation ever accompanying you, is a symbol of the new vigour in India-UK partnership."

With ratification targeted for early 2026, analysts see this as a counterweight to global trade frictions, including U.S. tariffs under President Trump. For now, the Modi-Starmer summit marks a pivotal step toward a "trustworthy, talent-driven" alliance, promising shared prosperity in an uncertain world.