Ministers are relaunching negotiations with India this week in an attempt to clinch a multibillion-pound free trade agreement that they hope will boost the UK’s flatlining economy.

Jonathan Reynolds, the business and trade secretary, flew to Delhi on Sunday to meet his Indian counterpart, Piyush Goyal, for the first time since Labour won the election.

The trip kickstarts the 15th round of trade negotiations with India, a booming economy of 1.4 billion people, after they were paused in May when Rishi Sunak called the general election.

Successive Conservative prime ministers tried to secure a trade deal with India, considered to be one of the biggest prizes of Brexit. Reynolds told the Guardian that sealing the deal was “a top priority” for him and that he was “not afraid to take the tough decisions needed”.

“We’ve seen trade secretaries come and go, and while their efforts have been sincere, it’s no secret that British businesses have nothing to show for it in terms of a final product,” he said. “They need a trade deal they can actually use to cut costs, grow their business and expand in the massive Indian market. That’s what this government is going to get them.”

During his visit to India, Reynolds and Goyal will visit BT India’s office in Gurugram. Poppy Gustafsson, the investment minister, is expected to hold business engagements in Mumbai and Bengaluru.

Saif Malik, the chief executive of Standard Chartered, which has been operating in India for more than 160 years, said the opportunities of a trade deal for businesses were “significant”.

“Whether it’s improved access to India’s growing consumer market, opportunities in manufacturing, infrastructure and innovation, or collaboration in financial and professional services, the relaunch of trade talks can unlock even greater trade, investment and prosperity across the UK-India corridor,” he said.

The UK and India are the sixth and fifth largest global economies respectively, with a trade relationship worth £41bn. India is forecast to become the third-largest world economy by 2028.

The country is a notoriously tough negotiator on trade, however. Narendra Modi’s government signed a £79bn agreement with the European Free Trade Association – a bloc made up of Norway, Switzerland, Iceland and Liechtenstein – in the spring, 16 years after talks began. Donald Trump said this month that Modi was a “much tougher” negotiator than him.

Boris Johnson and Liz Truss both set Diwali deadlines to reach agreements but failed to get them over the line. Under Sunak, negotiators got close to finalising a deal but this was put on ice when the UK election was triggered.

As part of the deal, the UK has asked for lower tariffs on goods such as cars and whisky, and increased access for British lawyers and financial services companies to the Indian market. In return, India has asked for faster and easier processing arrangements for its companies to send workers to the UK.

One sticking point has been Delhi’s concern that Indians working temporarily in the UK on business visas have to pay national insurance despite not being eligible for UK pensions or social security benefits.

The Guardian revealed in the spring that India has also asked for an exemption from the UK’s planned carbon border adjustment mechanism (CBAM) – a planned tax on the import of carbon-intensive goods such as steel, glass and fertiliser – on the basis that it is a developing country.

Any decision to exempt India from a carbon tax would be controversial. The plans are designed to reduce emissions and support UK steel producers by levelling the playing field with countries that have a lower or no carbon levy.

Ministers have recently touted a number of life sciences and tech companies that are increasing their exports to India. About £17bn goods and services were exported in total by UK businesses to the country in 12 months to September 2024.

Among the British businesses exporting to India are Radio Design, which has its headquarters in Shipley, West Yorkshire, and has opened a manufacturing facility in India, and the tech company marcusevans group, which has established its global tech operations in Mumbai.

ApplianSys, a tech company based in Coventry that offers internet-based education services, has developed a pilot to be used across almost 5,000 Indian schools.

Reynolds said tech and life sciences were “two huge growth sectors for the UK” and that their exports into the Indian market “will amount to tens of millions of pounds for the UK economy”.