Trade Relations Between India and The United Kingdom: From Colonial Legacies To The 2025 Free Trade Agreement

Abstract

This research paper delves into the transformative evolution of the economic and strategic relationship between India and the United Kingdom. It spans from the 17th-century colonial encounter to the contemporary era of the 2025 Free Trade Agreement (FTA). The study traces India’s historical shift from a dominant global industrial power to a colonial supplier of raw materials. Its share of global industrial output plummeted from 25% in 1750 to just 2% by 1900. The paper further analyses India’s post-independence phase of import-substitution industrialisation and the subsequent 1991 liberalisation. These events led to a reversal of economic hierarchies, exemplified by major Indian acquisitions of British industrial icons. Finally, the research examines the impact of Brexit as a structural rupture that compelled the UK to prioritise India as a strategic partner. Through cooperation in defence, technology security, and healthcare, the research argues that the bilateral tie has matured into an interdependent alliance. This alliance is shaped by the Roadmap 2030 and a vibrant 1.86 million-strong diaspora.