Climate Tech Central to the UK & India's New Trade Agreement
In 2025, the UK and India have signed their most comprehensive trade agreement to date. Sustainable technology (also known as clean tech or climate tech) is set to be a central part of this partnership going forward.
This week, UK Prime Minister Sir Keir Starmer welcomed India's Prime Minister Shri Narendra Modi to Westminster to unveil the UK-India Vision 2035 framework, a plan which promises to increase bilateral trade between the nations by US$31.7bn each year.
The agreement is specifically targeting India's rapidly expanding renewable energy market, offering British green technology companies unprecedented access to one of the world's fastest-growing clean energy sectors.
"It will create thousands of British jobs across the UK, unlock new opportunities for businesses and drive growth in every corner of the country, delivering on our Plan for Change," Starmer said during the signing ceremony.
Aerospace giants secure major Indian contracts
More than two dozen British companies are launching new ventures in India as part of the deal, with aerospace leaders Airbus and Rolls-Royce securing contracts worth around US$6.2bn.
These agreements will see both companies supply aircraft and engines to Indian markets, demonstrating the scale of industrial collaboration at the heart of the partnership.
The UK's Business and Trade Secretary Jonathan Reynolds also revealed nearly US$7.5bn in new investment commitments and export agreements alongside the trade framework.
"India is one of the fastest-growing economies in the world and an emerging economic superpower," Reynolds explains, recognising the strategic importance of the partnership for British businesses.
Access to clean energy
For Britain's green economy, the deal will provide an entry point into India's clean energy transformation.
Following the deal, analysts have anticipated some substantial growth in British green technology exports to India, as the subcontinent's energy transition accelerates in the coming years.
The timing aligns with India's ambitious renewable energy targets, creating opportunities for UK companies specialising in solar, wind and emerging clean technologies.
The partnership will also extend beyond simple market access. The deal establishes frameworks for the transfer of new technologies and will facilitate joint research initiatives in sustainable energy solutions between the two nations.
Technology and security
The agreement coincides with the first anniversary of the UK-India Technology Security Initiative, launched in July 2024.
Both governments reaffirmed commitments to leading development in AI, quantum computing, space innovation and cybersecurity technologies.
Partnering on frontier technologies such as these will complement the clean energy focus of both governments, with renewable energy infrastructure becoming more and more integrated with cutting-edge technologies each year.
The timeline and the potential impact
Parliament will ratify the agreement in coming weeks following standard legislative procedures.
Indian exporters will gain unprecedented UK market access, while British consumers can expect reduced prices across multiple product categories.
Tariff rates averaging 15% will fall to just 3% for British goods entering Indian markets, including medical equipment and automotive products.
Financial services liberalisation removes key barriers to UK investment in Indian markets, with maintained foreign investment caps providing stability for British firms.
The partnership represents a significant shift in post-Brexit trade strategy, positioning Britain to benefit from India's economic growth trajectory over the next decade.
Modi emphasised both nations' commitment to progress as equal partners in innovation, security and inclusive development during the historic signing ceremony.
