India-UK FTA Set to Boost Auto Trade, Reinforce West Midlands’ Role as Investment Hub

The landmark India-UK Free Trade Agreement (FTA) has been welcomed as a game-changer for regional economies and industries on both sides, with the West Midlands Growth Company hailing the pact as a major catalyst for investment, innovation, and job creation — especially within the automotive sector.

Finalized after 14 rounds of negotiations, the FTA is designed to eliminate tariffs on a wide range of goods and services and deepen economic engagement between India and the UK. Once implemented, the deal is expected to increase bilateral trade by £25.5 billion annually, according to government estimates.

The West Midlands stands to benefit significantly. Already the second-largest recipient of Indian foreign direct investment (FDI) after London, the region is home to a robust network of Indian-owned businesses including Jaguar Land Rover (JLR), Tata Steel, Tata Technologies, Tata Elxsi, Tata Consultancy Services (TCS), and TVS Norton. 

Neil Rami, Chief Executive of the West Midlands Growth Company, described the trade agreement as "a significant and positive step forward for the UK" at a time of global economic uncertainty.

“With the potential to increase bilateral trade by £25.5bn annually, it will provide domestic companies a first-mover advantage in the fastest growing G20 economy,” Rami said. “Reduced tariffs offer a much-needed boost to consumer spending power and create enormous potential to amplify the growth prospects of regions like the West Midlands.”

Rami noted that the West Midlands’ strong economic ties with India are best exemplified by Tata Group-owned JLR, a mainstay of the region’s automotive ecosystem. Other major Indian companies innovating in West Midlands include Tata Steel, Tata Technologies, TVS Motor Company, Firstsource, Microland and Mahindra Group.

“With tariffs slashed and exporting streamlined across synergistic growth sectors including aerospace and automotive, electrical circuits, medical devices and conductors, the West Midlands’ manufacturing supply chain stands to reap the benefits of this deal – which is timely and welcome news,” he said.

The India-UK FTA is particularly relevant for the automotive sector, where the country promises to cut import duties from over 100% to as low as 10%, though initially for limited volumes. Indian automakers like Mahindra & Mahindra, TVS Motor Company, and Tata Motors are also poised to increase their presence in the UK market.

Mahindra has announced plans to export its BE 6 and XUV 9e electric vehicles to the UK. TVS will manufacture its Norton motorcycles at its Hosur plant in Tamil Nadu for global distribution. Meanwhile, JLR is expanding its presence in India with a new plant in Ranipet, Tamil Nadu.

The two-way investment dynamic strengthens the strategic importance of the West Midlands as a global auto hub, linking innovation and manufacturing between both nations.

“This historic trade deal marks a bold new chapter for Britain’s relationship with India – and a major win for the West Midlands,” said Richard Parker, Mayor of the West Midlands. “By cutting tariffs and opening access to one of the world’s fastest-growing markets, this deal gives our advanced manufacturing, automotive, life sciences, and digital sectors the critical edge they need to thrive.”

“With this deal, we’re not just trading goods – we’re building futures that are filled with new jobs, investment and growth for the West Midlands,” he said.