Britain's Budget message is: If you invest in the country, we will back you

Indian businesses are in pole position to benefit from measures announced by Chancellor Rachel Reeves

The UK’s Finance Minister, Chancellor Rachel Reeves, recently published the Budget, and it is good news for Indian business investing in the United Kingdom.

 

Bilateral trade between India and the UK is soaring following the signing of a free trade agreement this year, with the latest data showing £47.2 billion of trade between our two countries in the year to June 2025.

 

This marked a 15.2 per cent increase over the same period last year, a surge largely driven by a 12.7 per cent rise in UK imports from India.

 

More than 1,000 Indian-owned companies already operate in the UK across sectors, from technology to finance. The UK-India investment relationship already supports over 600,000 jobs across both countries.

 

So, why should India care about the UK government’s recent Budget?

 

Well, there are three things you need to know about how the UK is improving its offer for international business and investment.

 

Firstly, growth remains the UK government’s number one mission.

 

Since coming to office, the government has increased capital investment by over £120 billion: In infrastructure, innovation, and green energy, creating the conditions for key industries to thrive.  

 

This Budget confirmed public investment at its highest sustained level in four decades, meaning investors can have confidence in the UK economy for the long term.

 

It sets out the next steps in strengthening the UK’s infrastructure to boost growth and productivity — including the location of the UK’s first small modular nuclear reactors; funding for a new crossing over the River Thames; and new AI Growth Zones spanning the country.

 

It builds on previous commitments, such as Heathrow Airport expansion, the Sizewell C nuclear power station, and improvements to transport infrastructure, as well as planning and regulatory reforms to remove barriers to investment and trade agreements with major partners.

 

These are long-term plans to build a stronger, more secure economy.

 

British and Indian businesses will directly benefit from this commitment to growth. Since the signing of the trade deal in July this year, new trade and investment deals worth nearly £11 billion have been announced between both countries.  

 

Second, we will not borrow beyond our means.

 

An unfunded borrowing spree is bad for stability, bad for business, and bad for investment.    

 

By cutting borrowing by more than any other G7 country by the end of this decade, the Chancellor is placing the country on track to have the largest Budget surplus in 20 years – strengthening our ability to make the most of growth opportunities now and in the future.  

 

At the same time, the Budget directly delivers a 0.4 per cent reduction in inflation in 2026/27 to move the UK into line with global peers through 2026 and closer to the Bank of England target rate of 2 per cent. This will help the Bank to continue to cut interest rates and stimulate investment.  

 

As a result of this Budget, the UK’s independent fiscal watchdog, the Office for Budget Responsibility, has upgraded its growth forecast by 0.5 per cent since March. Meanwhile the IMF says it expects UK growth to be the second fastest in the G7 this year, and the fastest among European G7 economies.    

 

This means more opportunities for services, manufacturing, life sciences and industry — and more opportunities for investment and returns.  

 

This is good news for Indian businesses, which have maintained their position as the second-largest foreign direct investors in the UK for the sixth consecutive year, both in terms of number of new projects and creation of new jobs.

 

Finally, this Budget has made the UK an even more attractive place to invest — with a major package of measures to help businesses start up, scale up, and stay in the UK.

 

We already have the lowest Corporation Tax rate in the G7 and the most generous tax reliefs for plant and machinery in the OECD. The Budget confirmed our commitment to both of these.

 

And we have now doubled investment limits for our internationally competitive Venture Capital Trust and Enterprise Investment Schemes, helping innovative companies raise equity as they scale.

 

We doubled eligibility for the Enterprise Management Incentive, giving employees of fast-growing companies access to share options with tax relief, so more have a stake in our tech industry’s future.

 

And we’re changing procurement rules, so more firms — big and small — can benefit from government contracts.

 

For the first time, UK-listed companies will have a three-year stamp duty holiday, as well as benefitting from incentives for savers to invest in the stock market.

 

These measures will grow the pool of capital available for listed companies and pave the way for the next generation of entrepreneurs and tech unicorns.

 

Indian businesses are in pole position to benefit from these measures. We saw the largest-ever Indian technology delegation of over 350 companies at London Tech Week this year, which is testament to the growing confidence amongst Indian start-ups and entrepreneurs to invest in the UK.

 

In short, this was a Budget for entrepreneurs.  

 

The commitment to stability, investment and reform is already yielding results.  

 

Growth has been upgraded, inflation is set to fall, and we will cut borrowing faster than any other G7 country.

 

In an uncertain world, we are securing the public finances, and we are choosing to invest in Britain’s future.  

 

And we’re making Britain the best place for business to start, grow, invest and stay.   

(The writer is the British High Commissioner to India.)

(These are the personal opinions of the writer. They do not necessarily reflect the views of www.business-standard.com or the Business Standard newspaper.)