Modi and Starmer tout India-UK trade deal as new Indian investment unveiled

By Alistair Smout and Ira Dugal

MUMBAI, Oct 9 (Reuters) - Indian Prime Minister Narendra Modi and British counterpart Keir Starmer hailed the potential on Thursday of their months-old trade deal to transform commercial links, as London unveiled new Indian investment in Britain and said "this is just the start".

Starmer is in the financial capital of Mumbai on a two-day visit to India, joined by more than 100 leaders from Britain's business, culture and university sectors, as he rushes to harvest the trade deal signed in July.

The deal agreed to cut tariffs on goods from textiles to whisky and cars, and allow more market access for businesses in the world's fifth- and sixth-largest economies, aiming to boost trade by a further 25.5 billion pounds ($34 billion) by 2040.

"In the three months since we actually signed that (trade deal) ... we've seen a 6 billion pound boost in trade and investment, that's on top of the increased numbers over the last year already," Starmer told business leaders of the two countries at the India-UK CEO Forum.

MODI HAILS INDIAN DYNAMISM, UK EXPERTISE

Modi told the forum that he was confident that the two countries would double their trade from the current $56 billion ahead of their 2030 target to do so.

Starmer's visit, accompanied by the largest-ever business delegation, "reflects the new energy and broad vision" in the partnership, Modi said after talks with the British prime minister.

"India’s dynamism and the UK’s expertise together create a unique synergy," Modi said, speaking in Hindi.

Starmer said the focus of his visit was about doubling down on the potential of the trade deal, expected to take effect within a year.

"This is just the start," Starmer later told a fintech conference. "It's time to invest in the United Kingdom, invest in this relationship and invest in our shared future."

An Indian foreign ministry statement said the two sides agreed to set up a connectivity and innovation centre and a joint centre for AI, and unveiled a critical minerals industry guild to bolster supply chains and promote green technologies.

INDIA, UK SIGN DEFENCE DEALS

Earlier, Starmer's office said 64 Indian companies would collectively invest 1.3 billion pounds ($1.75 billion) in Britain, without elaborating.

But the two countries do not agree on everything.

After Modi wished Russian President Vladimir Putin a happy birthday on Tuesday, Starmer joked to reporters that he would not be doing the same, given Britain's strong backing for Ukraine and condemnation of Russia over its invasion.

Britain says it respects India's strategic independence and Scottish Secretary Douglas Alexander, a former trade minister who joined the delegation, told reporters the issue had not prevented Starmer from leveraging close ties with Modi to expand the UK economy.

In an early indication of that strategy, Britain said it had signed a 350 million pound ($468 million) contract to supply the Indian army with lightweight multi-role missiles built in Northern Ireland, and the next phase of a deal, worth an initial 250 million pounds, to collaborate on electric-powered engines for naval ships.

New Delhi has for decades been dependent on Moscow for much of its military hardware but has slowly moved away in recent decades to buy from France, Israel, and the U.S.

Britain said two UK universities had been given approval to open new campuses in India, which it said would help the UK expand its influence "without adding pressure to domestic migration figures", as the government tightens rules around international students and has said more Indian visas weren't on the agenda for talks.

($1=0.7444 pounds)