India-UK trade and social-security pacts enter into force, activating tariff cuts and posting rules

The India-UK Comprehensive Economic and Trade Agreement, or CETA, entered into force on July 15, alongside a parallel social-security contributions pact, turning a signed trade framework into an operational one with immediate consequences for exporters, service providers and companies moving staff between the two countries. The start date, confirmed by official announcements from both governments, activates tariff preferences under the trade deal and rules meant to reduce double social-security payments for workers on temporary cross-border assignments.

That matters now because the agreement is designed to change day-to-day business conditions, not just future policy. Indian government material says the deal gives Indian exports to the UK zero-duty access on about 99% of tariff lines, covering nearly 100% of trade value. The same material says the pact includes services commitments across 12 major service sectors and 137 sub-sectors, a significant point for firms in areas such as IT, professional services, engineering, education, health, telecom and business services, where temporary postings and cross-border delivery are common.

The headline economic figures differ by country but point in the same direction: an effort to lower trade costs and deepen commercial ties. The Indian government has presented the agreement as opening near-complete tariff-free access for its goods exports to the UK and broader opportunities in services. The UK government says the deal will deliver 400 million pounds in tariff cuts within the first year alone and, in the long run, raise UK GDP by about 4.8 billion pounds. Those are government estimates, but they underscore why the agreement’s entry into force is being treated as a substantive trade milestone rather than a symbolic one.

The pact had been politically announced and signed last year, but only now has it taken legal effect. CETA was signed in London on July 24, 2025, in the presence of Prime Ministers Narendra Modi and Keir Starmer. India’s signing release identified Commerce and Industry Minister Piyush Goyal as India’s signatory and Jonathan Reynolds, then the UK business and trade secretary, as the UK signatory. The accompanying social-security agreement was signed later, in New Delhi on Feb. 10, 2026, with the published treaty text listing Lindy Cameron for the UK and Vikram Misri for India as signatories.

In practical terms, the social-security pact is meant to stop workers and employers from paying into both countries’ systems at the same time when staff are temporarily posted abroad. That can reduce payroll costs for cross-border assignments and matters especially in service-heavy sectors that rely on short- and medium-term deployments. But one accuracy point remains important: public documents do not fully match on how long detached workers stay covered only by their home-country system. The signed February 2026 treaty text, as well as side letters published in July 2025, refer to 36 months. Later UK government explanatory pages say the reciprocal exemption period will be 60 months. Businesses and advisers will need to pay attention to that discrepancy rather than assume a single settled number from public materials.

There is also an immediate administrative step for firms that want to use the trade deal’s tariff preferences: UK guidance says businesses must register with HM Revenue and Customs, the UK tax and customs authority. For companies exporting goods, supplying services or sending staff between India and the UK, the key change is that the agreement is no longer aspirational. As Peter Kyle, the UK business and trade secretary, said in a June government release: “We are bringing our landmark trade deal with India into force as quickly as we can, because we want businesses and the public to feel the benefits immediately, including cuts to tariffs of £400m within the first year alone.”