Indian Prime Minister Narendra Modi welcomed British Prime Minister Keir Starmer in Mumbai on Thursday, as the two leaders hailed a new trade deal that they said could transform bilateral economic ties.
Starmer visited India’s financial capital for two days, joining around 125 leaders from Britain’s business, culture and university sectors.
This welcome of Modi has come at a time when the Indian government is increasing efforts to attract global investment for the country’s rapidly growing economy.
India is projected to become the world’s fifth-largest economy in 2022, and overtake Japan to become the fourth-largest economy later this year, according to IMF data.
Britain is the sixth largest economy.
“This relationship matters more than ever,” Starmer told reporters at a news conference. “We are opening up new opportunities in India for British businesses, opportunities that other countries don’t have. This has given us a unique edge.”
“We are building a new modern partnership with a focus on the future,” Starmer said.
Modi echoed this sentiment, and said the strong relationship between India and Britain is “an example of stability in an uncertain world”.
What’s in a trade deal?
In Mumbai, Starmer said his country was doubling down on the prospects of a trade deal, which is expected to take effect within a year.
Currently, India and the UK have a bilateral trade value of approximately $54.8 billion (€47.4 billion) with investment supporting over 600,000 jobs in both countries.
The UK government said in a statement that the new trade agreement will increase this figure by another $34 billion, while exports to India will increase by about 60%.
The deal will cut tariffs on products shipped to India, including cosmetics, medical devices, Scotch whiskey and English gin.
Meanwhile, Britain will reduce duties on Indian clothes, shoes and food products and spices.
Under the new partnership, British universities have been given permission to open new campuses in India.
Additionally, a statement from the Indian Ministry of External Affairs also said that the two sides agreed to collaborate on technology and innovation with a joint center for AI. He also unveiled a key minerals industry guild to strengthen supply chains and promote green technologies.
Edited by: Wesley Rahn