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The UK-India trade deal came into force this week carrying a £4.8bn-a-year prize. But for Sukhpal Ahluwalia, the entrepreneur who built Euro Car Parts from a single Wembley shop into a business he sold for £280m, the agreement itself is not the achievement. The achievement is what British businesses now build on top of it.
The Comprehensive Economic and Trade Agreement, signed last July, entered into force on 15 July after years of stop-start negotiation. It is one of the most significant trade agreements India has ever signed and the UK’s largest since Brexit, projected by the government to add £4.8bn a year to UK GDP and £25.5bn to annual bilateral trade in the long run.
Ahluwalia, who now chairs GSF Car Parts and property group Dominus, has spent decades building businesses across both markets. His conclusion is blunt: it is businesses, not agreements, that create long-term growth. Yet the capital flows, joint ventures and institutional links that two economies of this size should have still do not exist at anything like the scale they could.
Too often, he argues, the UK-India relationship has been viewed primarily through the lens of trade. The greater opportunity lies in creating a genuine two-way exchange of investment, talent and innovation.
For smaller firms, the gap between opportunity and uptake is stark. Just 17 per cent of UK small businesses currently export at all, and of those only 12 per cent sell into India, a shortfall that initiatives such as Great British Pitch India, which put more than 40 export-ready firms in front of Indian buyers last month, are designed to close.
Nor is the hard work over in Westminster. MPs on the Business and Trade Committee have already warned that billions in tariff savings could be put at risk by plans to cut almost 40 per cent of the trade staff tasked with helping businesses expand into India. Initial tariff savings for UK exporters are estimated at around £400m a year, rising to as much as £3.2bn annually within a decade, but only if firms are supported to navigate India’s administrative complexity.
The timing, Ahluwalia believes, could hardly be better. With the UK gearing up for a new Prime Minister, the incoming government arrives on a wave of momentum and has the chance to put UK-India relations at the centre of its growth agenda from day one, rather than letting the relationship drift down the list of priorities.
There is precedent for treating the agreement as a beginning rather than an end. Advisers noted during negotiations that external pressures helped focus minds on completing long-stalled post-Brexit deals, and the same urgency now needs to carry through into implementation.
Ahluwalia’s core lesson from decades straddling the two markets is a simple one. People, not policy, make growth happen. Governments can create the framework, but it is businesses, trust and long-term partnerships that turn trade agreements into lasting economic growth.
The deal is done. The biggest win is yet to come, and it will not be signed in a ceremony. It will be built, deal by deal and partnership by partnership, by the businesses willing to do the work.
