UK-India FTA significant achievement but further development needed, says Lords International Agreements Committee

The UK-India Free Trade Agreement (FTA), signed last year, is a significant achievement with a formidable negotiating partner, says the House of Lords International Agreements Committee.  

In its report on the deal, published today, the committee says that until recently the prospect of concluding an FTA was considered remote. The negotiations took place against a challenging geopolitical backdrop for trade, including US tariffs under President Trump.   

The report concludes that a trade deal in this context is as much about providing stability for businesses, and a platform for continued strategic cooperation with a key partner in the Indo-Pacific, as it is about offering new market access. The FTA will be helpful to UK businesses as they seek to diversify and derisk their supply chains. UK consumers can expect to benefit from improved choice and lower prices - although the extent to which UK products will remain competitive as India opens its market, for example via its very recently signed FTA with the EU, remains to be seen.  

The committee does, however, highlight several key shortcomings. Firstly, that the benefits for UK goods exporters will take some time to materialise, rendering the Agreement a longer-term strategic investment for the UK, rather than a quick win. In contrast, Indian exporters will have full access to the UK market immediately. 

Secondly, the committee notes that to get the deal over the line, several key UK interests were disappointingly excluded from the Agreement, including legal services and investment protection. And it raises concern about the risk that non-tariff barriers, in particular Indian 'quality control orders', could undermine the objectives of the Agreement. 

The committee has called on the UK Government to set out what measures it is taking to support adversely affected industries and to publish an impact assessment of the effect of the cumulative impact of successive trade agreements on the UK agricultural sector, and to ensure that future trade agreements take account of these sensitivities. It also calls on the Government to continue to work with India to develop bilateral trade in services – which are not meaningfully supported in the current FTA. 

The report further recommends that the Government undertake a number of measures to support businesses in using the Agreement, especially small and medium sized enterprises, as well as setting out what increased supporting services will be provided through the High Commission in India and its regional offices. It should also continue to engage with India to develop the relationship and address barriers to trade. The committee draws the Agreement to the special attention of the House of Lords, on the grounds that it is politically important and gives rise to issues of public policy. The report is expected to be debated in the House of Lords in early March. 

Lord Goldsmith, Chair of the House of Lords International Agreements Committee said: 

“The UK has reached a landmark deal with a key strategic partner at a time of considerable geopolitical turbulence. We also welcome that the Agreement is compliant with World Trade Organisation rules, in light of the current challenges to the rules-based international order. It is a significant achievement, and the Government should capitalise on this by ensuring businesses can utilise it in practice.  

“However, we must highlight that in order to get the Agreement over the line, a number of notable UK interests were omitted. For example, legal services were omitted entirely from the text, which we consider a missed opportunity. The Government did not succeed in concluding a bilateral investment treaty. There is considerable scope for further developing the provisions for services trade and investment facilitation, and the Government should continue to engage with India on these issues. It also remains to be seen how competitive UK products will remain as India opens its market more broadly, particularly in the context of its very recently signed FTA with the EU. 

“We recommend the UK and India view the FTA as a ‘living agreement', rather than a static one, and prioritise strengthening the terms of the Agreement as the relationship develops. The Government should utilise the range of existing dialogue mechanisms and networks to further enhance the relationship in substantive and symbolic terms.” 

Note to editors

1. The International Agreements Committee scrutinises all treaties laid before Parliament under the terms of the Constitutional Reform and Governance (CRAG) Act 2010, and considers the Government's conduct of negotiations with states and other international partners. 

2. The UK signed the Free Trade Agreement with India on 24 July 2025. The agreement was recently laid in Parliament ahead of ratification, after which it will enter into force.   

3. The committee's inquiry, and the preparation of its report, took place before the EU and India announced the conclusion of their own FTA negotiations on 27 January 2026. The EU-India FTA has not yet been formally signed, ratified, or entered into force. The Committee's report recognises that the EU-India FTA may have implications for UK-India trade. However, in the time available, it was not able to analyse the implications, or compare the provisions to those India agreed with the UK, in any detail. 

4. Lord Goldsmith was the Committee Chair for the inquiry and at the time the report was agreed. His three-year term as Committee Chair expired shortly after the report was agreed by the Committee, which is now chaired by Lord Johnson of Lainston. However, media enquiries relating to this report should still be directed to Lord Goldsmith.