A parliamentary scrutiny report in the UK has described the India-UK Free Trade Agreement (FTA) as a historic and strategic step that offers stability and long-term benefits for rules-based international trade amid global geopolitical uncertainty.

The House of Lords International Agreements Committee, which reviewed the India-UK Comprehensive Economic and Trade Agreement (CETA), said the deal was a significant achievement given the challenging global trade environment and protectionist pressures. The agreement was concluded during Prime Minister Narendra Modi’s visit to the UK last July.

The committee noted that the FTA would help UK businesses diversify and de-risk supply chains while strengthening ties with a key strategic partner. It also welcomed the agreement’s compliance with World Trade Organisation rules at a time when the global trade order faces increasing strain.

However, the report pointed out shortcomings, including limited new market access for financial and professional services, the exclusion of legal services, and the absence of a bilateral investment protection treaty. It recommended that both countries treat the FTA as a “living agreement” and work towards strengthening its provisions over time.

The peers also cautioned that the recently concluded India-European Union trade agreement could impact the competitiveness of British exports as India opens its market further. While UK consumers may benefit from lower prices and better choice, the long-term advantages for UK exporters may take time to materialise.