The UK is edging closer to one of its most significant achievements in the post-Brexit era, signing a lucrative trade deal with one of the world’s fastest-growing economies – India. Both sides have publicly stated that they are working towards completion before a Diwali deadline on 24 October, and with general trade negotiations scheduled to finish at the end of this month, this appears to be a realistic target.

Gaurav Singh, founder of the largest bilateral investment banking platform across the two nations, JPIN, states that the completion of a trade agreement could pump billions more into the UK’s economy, generate further employment opportunities, attract skilled talent to fill the dire shortage, improve digitalisation and tech expansion, and ultimately bring the nation back to its pre-pandemic glory days as one of the world’s leading economies.

The UK–India investment relationship is already worth £25.7bn and supports 110,000 jobs across the UK. This represents an increase of 35.2% or £6.7 billion compared to 2021, but experts such as Singh assert that although this growth is impressive, the FTA could cause the total value of trade between both countries to double by 2030, which would have profoundly positive effects on the UK economy.

Not only is trade on the rise between the UK and India, but British businesses have been benefiting from increased investment from Indian firms. The government’s Trade and Investment Factsheet highlights that inward FDI from India was worth £10.6bn in 2020, representing an increase of 15.2% or £1.4 billion compared to the previous year.

India therefore presents itself as a vital partner for the UK, and will be pivotal in helping ease the effects of the current economic slump. Dubbed as Asia’s Silicon Valley, its $3 trillion GDP means that it’s on track to becoming the third largest economy in the world by 2050, and the nation is already set to overtake China as the fastest-growing economy by the end of the year.

Britain is not alone in noticing the country’s growing importance as a consumer market, especially as a geopolitical counterweight to China. India is currently pursuing trade deals with the EU and Canada, after cementing agreements with the United Arab Emirates and Australia. The nation continues to rapidly stretch its might across the world stage with a young and dynamic population of 1.39 billion people. A staggering 43% of skilled workers entering the UK last year were Indian nationals, highlighting that through increased collaboration, the skills shortage could also be significantly reduced.

Gaurav Singh, founder of JPIN, comments on what the potential trade agreement means for businesses in the UK and India:

“At a time when economies around the world are facing significant macro-economic headwinds, the importance of increased trade collaboration between countries is really coming to the fore. We could be just a few months away from seeing a lucrative free trade agreement being signed by the UK and India, which stands to significantly benefit both sides.

“A Diwali deadline has been set, and there don’t appear to be many stumbling blocks that would prevent this from materialising. The UK-India relationship already supports 110,000 jobs in the UK, and foreign investment into Britain from India was worth £10.6bn in 2020, but this could just be the beginning of an even more fruitful relationship. It would also mark one of the biggest and most important steps in the post-Brexit era.”