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UK and India Celebrate 'Transformative' Trade Deal as £1.3 Billion Investment Announced

British Prime Minister Keir Starmer and Prime Minister of India Narendra Modi attend the Global Fintech Fest on October 9, 2025, in Mumbai, India. Leon Neal/Pool via REUTERS
British Prime Minister Keir Starmer and Prime Minister of India Narendra Modi attend the Global Fintech Fest on October 9, 2025, in Mumbai, India. Leon Neal/Pool via REUTERS

MUMBAI, Tamsil Shahezad Khan - British Prime Minister Keir Starmer and Indian Prime Minister Narendra Modi praised their newly signed trade agreement as a potential game-changer for bilateral commerce, as Britain announced major Indian investments worth £1.3 billion ($1.75 billion) during Starmer's two-day visit to Mumbai.

The British leader arrived in India's financial capital accompanied by over 100 representatives from Britain's business, cultural, and academic sectors, marking the largest-ever UK business delegation to the country. The visit aims to capitalize on the momentum of the trade deal signed in July.

A Deal Designed to Boost Commerce

The comprehensive agreement includes tariff reductions on a range of goods—from textiles and whisky to automobiles—and expands market access for businesses operating in the world's fifth- and sixth-largest economies. Officials project the deal will increase bilateral trade by £25.5 billion ($34 billion) by 2040.

"This relationship matters more than ever," Starmer told reporters. "We're opening up new opportunities in India for British businesses, opportunities that other countries simply do not have. It has given us a unique edge."

Modi expressed similar optimism, telling a business forum that he was confident the two nations would double their current $56 billion in trade well ahead of their 2030 target.

"India's dynamism and the UK's expertise together create a unique synergy," Modi said, speaking in Hindi.

New Investments and Partnerships

Starmer's office announced that 64 Indian companies will collectively invest in Britain, though specific details about the investments were not immediately provided. The British prime minister characterized these commitments as "just the start" and emphasized that major new investments are expected to create thousands of jobs.

Beyond trade, the two countries unveiled several strategic initiatives, including a connectivity and innovation center, a joint artificial intelligence center, and a critical minerals industry guild aimed at strengthening supply chains and advancing green technologies.

Defense Cooperation Expands

In a significant development for bilateral defense ties, Britain announced a £350 million ($468 million) contract to supply the Indian army with lightweight multi-role missiles manufactured in Northern Ireland. Additionally, the countries agreed to the next phase of a collaboration on electric-powered engines for naval ships, initially valued at £250 million.

The defense deals represent India's continued diversification away from its traditional reliance on Russian military hardware, with New Delhi increasingly turning to suppliers including France, Israel, the United States, and now Britain.

Areas of Disagreement

Despite the celebratory tone, the two leaders acknowledged differences on certain issues. When asked about Modi's recent birthday wishes to Russian President Vladimir Putin, Starmer noted he would not be extending similar greetings, given Britain's strong support for Ukraine.

Starmer confirmed that he and Modi discussed India's purchases of Russian oil, focusing their conversation on strategies to end the Russia-Ukraine conflict—"the outcome that we both want," according to the British prime minister.

British officials emphasized that the UK respects India's strategic independence and can maintain productive partnerships even when views diverge on specific matters.

Education and Migration

In another development, two British universities received approval to open new campuses in India. Britain framed this as an opportunity to expand UK educational influence "without adding pressure to domestic migration figures."

The Starmer government has recently tightened regulations around international students, and officials confirmed that increasing Indian visa access was not part of the current discussions.

Looking Ahead

Both leaders expressed confidence that the trade deal, expected to take effect within a year, represents the foundation for a deeper and more dynamic partnership.

"It's time to invest in the United Kingdom, invest in this relationship and invest in our shared future," Starmer told attendees at a fintech conference in Mumbai before departing for Britain.

With cooperation spanning technology, education, defense, and artificial intelligence, the UK-India partnership appears poised for significant expansion in the coming years.

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